Money is central to the many steps people take in romantic relationships. From going on dates to moving in together, discussing financial topics like credit keeps expectations and situations clear.
But before marrying someone with bad credit, you should know how their poor score will (and won’t) affect your finances. From the first financial discussion to getting a mortgage together, here’s how marriage and credit scores work.
Are you marrying someone with bad credit?
Every couple trying to combine their lives and finances needs to sit down to discuss their financial situations. Don’t assume your soon-to-be-spouse has great credit — have a frank discussion and talk specifics.
Starting these conversations isn’t easy, but it is worth it. An ideal time to talk about it could be before making a big move, like getting engaged or moving in together.
You’ll need to know what each of your credit scores and histories looks like. This could impact the decisions you make together, including renting an apartment or taking out a personal loan together to finance a wedding.
Discussing your credit scores and finances
It’s important to be honest about your own financial situation, including savings, income, debts, and credit score. Bring any recent credit reports and scores to the discussion, and ask your significant other to do the same.
If either of you is missing this information, it’s time to get a free annual credit report. You might need to help them pull a free credit report, or check their credit score if it’s not something they’ve ever done.
Along with credit reports and scores, you’ll also want to discuss major debts or past delinquencies. It’s important to understand how the decisions to take on those debts were made, and the circumstance that led to a delinquency or default.
It doesn’t have to be a deal-breaker, but it’s important that the partner with a bumpy past owns up to those mistakes. That partner, whether it’s you or your significant other, should show that they’re on the right path to fixing things and have a plan to avoid similar mistakes down the road.
How marriage and credit scores mix
You’ve had the discussion about credit scores — and it turns out that you have a spouse with bad credit. You’re likely wondering, “Does my spouse’s credit affect mine?”
On its own, your spouse’s bad credit won’t impact yours. You will each maintain your own credit histories, reports, and scores.
Credit bureaus and lenders don’t consider your spouse’s credit when giving you a credit score or deciding to approve or deny a loan application in your name. Similarly, marrying someone with bad credit won’t lower your score at all, either.
Sharing credit accounts
The only way a significant other’s or spouse’s credit will affect yours is when you share a credit card or other account. This is the main way that marrying someone with bad credit affects your finances.
If you share an account and a spouse is irresponsible with the debt, racking up high balances or missing payments, that affects your score. This negative borrowing behavior will be reported to credit bureaus and show up on your credit report since you are a cosigner or authorized user of that account.
Getting a mortgage or loan together
If you two want to take out a loan together, your spouse’s bad credit could hold you back. What does that mean for the life you’re building together? If you’re applying for a loan or mortgage together, consider how the partner’s bad credit will affect your chances of approval and the rates offered.
You’ll both need to be listed as co-applicants on the loan for both of your incomes to be considered. But if one person’s credit is worse and this is also the partner with a lower income, it might be advantageous to have only the partner with good credit on the application and loan.
Alternatively, it’s possible that the two of you can find a third cosigner, like a parent with good credit, who can be added to the loan agreement to offset the partner’s poor credit.
How to help a spouse with bad credit
If your spouse does have bad credit, what can you do about it? There are lots of ways to work together as a couple to repair a poor credit history.
When you pull your credit histories and review them together, make sure to watch for any errors or misreported information. If either of you has errors present on your credit, take the time to dispute it and get it removed.
Second, the partner with good credit can add the other as an authorized user to a credit card with a longstanding positive history. This adds a credit line to the mix that has both a positive history and a long one. Both factors can help boost your partner’s credit score.
Lastly, work together on paying down credit card debts. You might also get a credit limit increase. The credit utilization ratio is a big factor in formulating a FICO score, the most commonly used by lenders. If you can lower credit card debts or raise the credit limit, it will lower the credit utilization ratio and boost a bad credit score.
Marrying someone with bad credit can introduce complications, but a poor credit score doesn’t have to be the end of your relationship, or even hold you back in your life together. Work together to fix it and soon, it’ll be a thing of the past.
Interested in a personal loan?
Here are the top personal loan lenders of 2018!| Lender | APR Range | Loan Amount | |
|---|---|---|---|
1 Includes AutoPay discount. Important Disclosures for SoFi. SoFi Disclosures
2 Includes AutoPay discount. Important Disclosures for Payoff. Payoff Disclosures
3 Important Disclosures for FreedomPlus. FreedomPlus Disclosures
4 Important Disclosures for Citizens Bank. Citizens Bank Disclosures
5 Important Disclosures for LendingPoint. LendingPoint Disclosures
6 Important Disclosures for LendingClub. LendingClub DisclosuresAll loans made by WebBank, Member FDIC. Your actual rate depends upon credit score, loan amount, loan term, and credit usage & history. The APR ranges from 6.16% to 35.89%. For example, you could receive a loan of $6,000 with an interest rate of 7.99% and a 5.00% origination fee of $300 for an APR of 11.51%. In this example, you will receive $5,700 and will make 36 monthly payments of $187.99. The total amount repayable will be $6,767.64. Your APR will be determined based on your credit at time of application. The origination fee ranges from 1% to 6% and the average origination fee is 5.49% as of Q1 2017. There is no down payment and there is never a prepayment penalty. Closing of your loan is contingent upon your agreement of all the required agreements and disclosures on the www.lendingclub.com website. All loans via LendingClub have a minimum repayment term of 36 months or longer. 7 Important Disclosures for Earnest. Earnest Disclosures
8 Important Disclosures for Avant. Avant Disclosures* The actual rate and loan amount that a customer qualifies for may vary based on credit determination and other factors. Funds are generally deposited via ACH for delivery next business day if approved by 4:30pm CT Monday-Friday. Avant branded credit products are issued by WebBank, member FDIC. ** Example: A $5,700 loan with an administration fee of 4.75% and an amount financed of $5,429.25, repayable in 36 monthly installments, would have an APR of 29.95% and monthly payments of $230.33 * Important Disclosures for Upgrade Bank. Upgrade Bank Disclosures* Your loan terms are not guaranteed and are subject to our verification and review process. You may be asked to provide additional documents to enable us to verify your income and your identity. This rate includes an Autopay APR reduction of 0.5%. By enrolling in Autopay your payments will be automatically deducted from you bank account. Selecting Autopay is optional. Annual Percentage Rate is inclusive of a loan origination fee, which is deducted from the loan proceeds. Late payments or subsequent charges and fees may increase the cost of your fixed rate loan. All loans made by WebBank, member FDIC. Please refer to Upgrade’s Terms of Use and Borrower Agreement for all terms, conditions and requirements. ** Accept your loan offer and your funds will be sent to your bank via ACH within one (1) business day of clearing necessary verifications. Availability of the funds is dependent on how quickly your bank processes this transaction. From the time of approval, funds should be available within four (4) business days. |
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 | 7.73% – 29.99% | $1,000 - $50,000 | Visit Upstart |
 | 6.26% – 14.87%1 | $5,000 - $100,000 | Visit SoFi |
 | 6.99% – 35.97%* | $1,000 - $50,000 | Visit Upgrade |
 | 8.00% – 25.00%2 | $5,000 - $35,000 | Visit Payoff |
 | 4.99% – 29.99%3 | $10,000 - $35,000 | Visit FreedomPlus |
 | 5.99% – 18.99%4 | $5,000 - $50,000 | Visit Citizens |
 | 15.49% – 34.49%5 | $2,000 - $25,000 | Visit LendingPoint |
 | 6.16% – 35.89%6 | $1,000 - $40,000 | Visit LendingClub |
 | 6.99% – 18.24%7 | $5,000 - $75,000 | Visit Earnest |
 | 9.95% – 35.99%8 | $2,000 - $35,000 | Visit Avant |