When it comes to marriage and credit score, it may not be top of mind as you’re planning a life together. Between planning a marriage, moving together, and honeymoon, sometimes certain financial details become an afterthought. But after a while, it hits: What if your partner's finances impact your life—positively or negatively?
How, exactly, does marriage affect credit score? In reality, tying the knot can be less damaging to your credit score than you might fear, especially if you manage to keep separate finances. However, there are some specific situations in which a spouse with bad credit could affect the other. Here's everything you need to know.
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How does marriage affect credit score?
Marriage itself does not affect credit score. Couples often think that credit scores merge after marriage, but this myth is clearly debunked by credit bureaus like Equifax and Experian.
Your credit score is individual, linked to your Social Security number (SSN), other personal information like your birth date and full name, and your behavior as a consumer. Payment history, credit utilization ratio, and age of credit accounts are the most important factors in determining credit worthiness. Your marital status is not a factor—even if you change your name after marriage, it won't affect your credit score.
So, when does marriage affect credit score?
The only instances where marriage can affect your credit score is when you and your spouse open joint credit accounts, add each other as an authorized user on a credit card, or cosign a loan. Here's a breakdown of what could happen in each case:
- Joint accounts: These accounts are in both your names, so any financial activity in the account will be reflected in both credit reports. For credit bureaus, there is no distinction of who made a certain transaction in a joint account—both account holders suffer consequences equally.
- Authorized user: If you add your spouse as an authorized user of a credit account in your name, you're responsible for the payments. If they overspend, cause an overdraft, or exceed your budget for the month and you miss or make a minimum payment, your credit score will suffer. Your spouse's credit score might be affected as well if your bank reports the authorized user account to credit bureaus.
- Cosigning a loan: When you cosign a loan for your spouse, you're basically agreeing to pay it in case they don't. If they frequently miss payments, and you're unable to cover it on the due date, this can lower your credit score as payment history is one of the most relevant factors.
Note: As a cosigner, besides potentially lower your credit score, missed payments can make you a target for debt collectors—even if you're not the one using the money or account. “Debt collectors can’t target you for your spouse’s debt unless your name is tied to it,” says Milli Barker, international lawyer and founder of RemotePad.
Do lenders look at both spouses' credit scores?
Yes, but only if you apply for financial opportunities, like a mortgage or loan, jointly (in that case, you’d be co-borrowers, rather than one of you applying for the loan and the other co-signing it). In these specific cases, lenders will consider both credit scores. So, if you're wondering, “What if I have a good credit score but my partner doesn't?” know that your credit scores are compared and lenders consider the lowest middle between both of you, according to Equifax.
Thus, if your spouse's credit score is too low, you might get denied financing or get higher interest rates. However, if you apply individually, your spouse's credit score won’t affect the lender's decision.
How to improve a credit score
If your spouse has a bad credit score and it's affecting your life, they can work to improve it over time. Here are some essential steps to have better credit:
- Pay bills on time. Payment history is the most important component of a credit score. Aim to pay your bills on time every month, even if you only make minimum payments.
- Pay off any debts. This is second on the list of most important factors of a credit score. To improve your spouse's credit score, you should work together to reduce and eventually pay off any existing debts in their name. Start by making a budget and designating a portion of your income to debt repayment. (Here's how to budget to pay off debt.)
- Keep a low credit utilization ratio. Your credit utilization ratio is the percentage of your credit limit currently being used. Ideally, it should be lower than 30%. Since your utilization rate is linked to your amounts owed, paying off debts (and avoiding making more), can help in this department.
- Keep a lengthy credit history. Some people think that closing credit card accounts is beneficial to your credit score, but that's not true. Ideally, you should keep at least two different types of credit accounts open (FICO® Score refers to it as a “credit mix”) and build a lengthy history.
- Avoid too many hard inquiries. Constantly applying for new credit accounts can negatively impact one's credit score. Though the effects are usually temporary, you should wait at least six months between inquiries for credit.
FAQs
Is my credit score affected by my partner?
No, your credit scores are individual and won't affect each other after marriage. Even if you legally change your name and start using your spouse's last name, your credit score remains the same. The only instances in which your spouse could affect your credit score is if you open a joint account or apply for a loan as co-borrowers, cosign a loan, or add your spouse as an authorized user in a credit card account.
Will my credit go down if I marry someone with bad credit?
No, your credit score doesn't go down if you marry someone with bad credit. Generally, marriage doesn't affect credit score, unless you have joint credit accounts or loans. Then, your spouse's financial habits could lower your score.
Will my credit cards show up on my spouse's credit report?
No, your credit cards don't show up on your spouse's credit report and vice versa. The only way a credit card would appear on your spouse's credit report is if they add you as an authorized user in their credit account. In this scenario, this specific credit card is attached to their credit report.
How do I separate my credit from my husband?
If you want to prevent your spouse from hurting your credit score, the key is not to merge finances. “Keep your accounts separate if you want to avoid liability for each other’s debts,” Barker says. “Stay vigilant and regularly monitor your credit reports to spot no unwanted surprises.”
Does getting divorced affect your credit score?
Getting a divorce doesn't affect your credit score, since your marital status isn't a factor credit bureaus take into account. However, if you have joint accounts, loans, or credit cards, be sure to cancel the accounts and stay on top of any existing debt because anything filed jointly can affect score—even if you're not the one using the money. In this case, “consider a marriage contract—prenuptial or postnuptial agreements can shield your assets from your spouse’s debt,” Barker says.
Does my spouse's debt affect me?
That depends. If the debts were acquired before marriage, it doesn't affect you. However, when it comes to debt acquired during marriage, you may be liable if you live in a community property state. “In community property states, creditors can go after joint assets for debts accumulated during the marriage,” Barker says. Also, anything financing filed jointly (loans, mortgage, credit card accounts) is a joint responsibility.
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