Before you get married, you may think of marriage as the next step in your romantic relationship. A wedding is when you bring together both people’s family and friends in a ceremony that binds your love.
But marriage itself is a legal and financial contract that also has huge ramifications for the rest of your life. It can affect where you live, what kind of house you buy and in general, what kind of life you have.
If you marry someone with bad credit or a spending problem, you may discover how much more complicated your life becomes. Suddenly, steps like buying a house become much more difficult.
The question of what happens to your credit after marriage is a complicated one to answer. Read on to see how your new spouse’s credit can affect you and what happens if you marry someone with bad credit.
So, does getting married affect your credit score? Your credit score is your own personal reflection of how responsible you’ve been with loans, lines of credit and other financial responsibilities. If you’ve ever been evicted, foreclosed upon or declared bankruptcy, that will show up on your credit.
Like a Social Security number, a credit score is an individual number. When you get married, your partner’s loans and credit cards don’t automatically get added to your credit report. Simply signing a marriage certificate with someone doesn’t increase – or decrease – your credit.
Your credit behaviors can affect each other if you sign up for a loan together or if you become a cosigner on any of their loans or an authorized user on their credit card. If your husband applies for a car loan and has a hard time getting approved because of his bad credit, he may name you as the cosigner.
When that happens, the loan will then appear on your credit report. If your husband fails to pay the loan or makes late payments, your score will start to suffer. If he defaults on the loan, the lender may ask you to take responsibility. If you don’t, they can sue you for payment.
One of the top reasons for divorce is financial problems. People discover the person they married is a shopaholic with a hoarding problem or a cheapskate who doesn't tip at restaurants, for example.
You probably are not considering your future spouse's debt or bad credit score while you're still dating. Sometimes it can be hard to discover this information before the big day. Many couples don't merge finances until after they get married. Some couples never commingle their bank accounts or have a joint credit card, so their partner has no way of finding out what their financial situation is.
Bad credit is an important indicator of how well someone manages their money and how they tend to make financial decisions.
A 2015 report from the Federal Reserve Board, titled “Credit Scores and Committed Relationships” found that people who had similar credit scores were more likely to be happier and stay together than couples with disparate credit scores.
This study suggested that people with good credit scores were more responsible and trustworthy and “that credit scores reveal an individual’s relationship skill and level of commitment.”
If someone has bad credit, it doesn’t have to be an inherent dealbreaker, but how they handle that credit going forward can be a good indicator. For example, if you’re dating someone with a 400 credit score and they ignore the problem, that could be a red flag for the future of your relationship.
But if that person is using credit responsibly and working to erase their past, then you’ll know they care about rectifying their mistakes.
Marrying someone with bad credit isn’t an inherently bad idea, but it can affect your life. For example, if you want to take out a mortgage, the lender will use both of your credit scores and offer a mortgage either based on the lower of the two or the average.
A partner with a low score may preclude you from getting approved for a mortgage or may force you to pay a higher interest rate than if you applied by yourself. When a married couple has a partner with a bad credit score, the other person may decide to apply for a mortgage by themselves to get a better rate.
That may seem like a good idea, except if the couple gets divorced. Then the person who is not on the mortgage title can simply walk away from the loan even if they had originally been helping with payments. The person whose name is on the loan may then be forced to sell the house or end up foreclosing if they can’t afford the payments alone.
The issue could go the other way too, of course. With the person who holds the mortgage title having all rights to the home in the case of divorce.
If you’re trying to rent a house or apartment, having a spouse with poor credit can disqualify you for an apartment. Landlords often run credit checks for everyone who will be living in the apartment, and if one person has a bad credit score, both people may be denied.
Another example could be if your spouse tries to apply for a utility provider and they have bad credit, the company may ask that they put down a deposit.
Basically, while your spouse having worse credit than you isn't necessarily a dealbreaker, it could make the life you're trying to build together much more costly, or force you to postpone major purchases until your spouse can improve their credit.
There’s a difference between no credit and bad credit. The latter means you have a low credit score or some negative marks, like a bankruptcy or default judgment, on your credit.
No credit means you’ve never had a loan, line of credit or other type of credit product. Having no credit can be a frustrating experience. To start creating a credit report, you need to open a credit card or loan. But it’s hard to get approved if you’ve never had a loan before. How can you convince a lender you’re trustworthy if you’ve never had to repay a loan?
If your spouse has no credit, you can have them take out a credit builder loan or a secured credit card to start building their credit. These products are designed for people with bad credit or no credit to help them restore or start a credit report.
If your spouse doesn’t have any credit and opens one of these products, help them by explaining how to build a solid credit history. Have them learn what makes a good credit user, how to make payments on time every month and how not to use too much of their available credit.
If your spouse learns to use a credit product responsibly, they may go from no credit to great credit in a few months. This will make managing your finances together much easier since you’ll be able to qualify for loans together.
Getting married may only increase the odds of getting approved for a loan because you may have a larger income to qualify with. If you make $50,000 a year and your spouse makes $100,000 a year, you may get a bigger mortgage than if you were only using your income, for example.
Debt acquired prior to marriage remains tied to that individual. This only changes if you refinance the debt and put it in both people’s names. For example, if you buy a house by yourself and then get married, the mortgage is still legally yours.
But if you refinance the loan and add your partner to that loan, then the mortgage belongs to both of you. If you marry someone who has student loans, the loans remain theirs even after marriage.
Federal student lenders may use both people’s income information to decide what kind of monthly payment you can afford.
Debt that you both incurred during the marriage will be divided differently depending on your state’s laws and any prenup you may have had. Your credit score may be affected after a divorce because divorce is almost always expensive and can drain a person’s bank account, forcing them to rely on debt.
If you’re the spouse with bad credit and your wages are garnished because of a court judgment, you may worry that your spouse will be affected.
In most cases, a judge will not allow the creditor to take money from your spouse’s bank account if the debt was solely yours. However, if you live in a community property state, then the court may allow the creditor to garnish from your bank account as well.
When you get married, your bank accounts, loans and credit cards don’t automatically become joint accounts. Banks and credit card providers don’t convert your account unless you ask them to.
That means your spouse doesn’t get automatic access to your credit card just because they’re now legally bound to you. You still have to call the credit card provider and add them as a user on the account. The same is true for both checking and savings accounts.
If you’re depending on your spouse to bring good credit to the marriage (or vice versa), remember that your credit score will always stay individual, no matter what accounts you join.
If you can, try to talk about your finances and credit before you get married, to avoid any unwelcome surprises. Either way, try to get on the same page about your finances and help each other work on improving your credit if you need to.
Zina Kumok is a Financial Health Counselor and Credit Counselor certified by the National Association of Certified Credit Counselors who writes extensively about personal finance. See Zina on Twitter.
Lauren Bringle is an Accredited Financial Counselor® and Content Marketing Manager with Self Financial – a financial technology company with a mission to help people build credit and savings. See Lauren on Linkedin and Twitter.