December 12, 2014
I am often asked by many young couples seeking to “tie the knot” as to how their credit rating will be affected when they marry. Many are concerned by myths and misconceptions about what happens to their credit rating if they choose to become an official couple. So, I thought I would use this week’s blog to explain.
If you have ever wondered what the difference is between Big Bank A’s mortgages and Big Bank B’s mortgages, let me assure you that the differences aren’t necessarily noted by just different fees and interest rates. The main differences are often found in the way the different lenders choose to assess your credit file.
This is why you are at an advantage by choosing me to arrange your loan. Because I am very familiar with what the different lenders look for when they assess your application I can help you by letting you know which lender is most likely to approve your application. The last thing that you want is for a lender to assess your application and choose to decline it. This results in a “credit enquiry” being registered on your credit file – a scenario that could go against you when you make an application with the “right” lender.
Lenders want to know a lot more about you than you could imagine, before they agree to extend you a home loan. Knowing what information they seek will help you to manage your credit file in a way that pleases their appetite for information about you.
Some of the main things all lenders look at are;-
* Your salary
* Your age
* How many children you have
* How often you change addresses
* A history of your credit accounts
* The mobile phone contracts you have
If you change your name after you are married and report this change to your creditors, you will see some updates to your existing credit reports. Along with your old name, your new name will be listed as an alias. You will not have to start from scratch with a new credit file.
Huge amounts of credit card debt from funding your wedding and your honeymoon may harm your credit scores, but the act of getting married will not.
Essentially, nothing automatically changes on your credit reports when you get married, so nothing should impact your credit file. And your spouse’s poor credit history should also have no effect on your credit file.
If you’ve held a joint account with someone who has a bad credit record, this may affect your ability to get credit. The reason for this is that lenders may assume that your partner could have an influence on your income at any time. It’s important to close these accounts and take care of any shared debt you may have.
And finally, Marriage doesn’t automatically make you an authorised user or co-signer on your spouse’s accounts. If you wish to be added to your spouse’s credit cards, you will need to call the creditors with this request. Also it is important to know that being added as an authorised user will not result in the account being factored into your credit file.