Building credit and maintaining a good credit score is one of the most financially stressful things to keep track off as we all know. But what, if anything happens to your score when you get married? Well long story short, getting married has no impact on your individual credit score. However, bringing your spouse into the mix can affect your buying decisions if one or both of you don’t have a stellar track record.
Did you know that you are entitled to one annual credit report annually and because of COVID-19 you can actually check your credit score weekly? Learn more about how this works from the Annual Credit Report website.
Can I Get a Mortgage Loan if My Spouse Has Bad Credit?
Marriage itself does not itself improve your credit or negatively affect your credit score. However, if you marry a person who does not have stellar credit, you may face an uphill battle when you try to purchase property with your new spouse.
If your spouse has subpar credit, buying a house will be difficult. If you both want to be named on the mortgage documents, a bank will run a credit check on you and your spouse. You may have trouble getting a loan for your mortgage. As you may be aware, the higher your credit score is, the lower the interest rate on your mortgage loan is, if you can get a loan for a mortgage at all. Even if you have a good credit score, if your spouse has a low credit score your mortgage loan this can make your interest rate a bit tricker to keep down and might limit your search in finding your dream home. That is of course, if you go for it right away without trying to rebuild credit.
In addition to you and your spouse’s credit scores, other financial information that a bank will review before offering a loan for a mortgage include:
- You and your spouse’s current income
- You and your spouse’s credit report
- How much debt you and your spouse carry month to month
- Whether you or your spouse have a credit history with the bank where you are applying for a mortgage
- The amount of money in your savings account
Does My Spouse’s Low Credit Score Limit My Choices for Apartments?
If your credit score or your spouse’s credit score is low, you may face trouble renting an apartment. Your spouse may be unable to have their name on the lease if their credit score is low. Reviewing an applicant’s credit report is a common practice for renting agencies. When an apartment complex pulls your credit report, it is looking for the following information:
- Rental History- a landlord wants to know that you have a history of paying your rent on time and that you have not been evicted from another complex. A landlord may be hesitant to rent to you and your spouse if either of you have a negative rental history.
- Payment History- a landlord specifically looks at payment history to judge how responsible you have been with money in the past. Paying utility bills, car payments, and other periodic or revolving payments are typically including in your payment history.
- Collections- of course, a collection on your credit report will negatively affect your access to an apartment rental.
Can My Spouse’s Credit Negatively Affect Getting a Car Loan?
Like a mortgage loan, the higher your credit score is the more likely you will qualify for a car loan with a lower interest rate. Your credit score helps lenders determine how likely you are to repay a debt. If your spouse has a low credit score, consider taking out a car loan in your name only if your income is high enough to cover the expense.
If you and your spouse decide to take out a joint loan for a car, their credit score will affect your access to a good interest rate. If you can secure a loan, the amount of money that you receive will likely be lower and come with a higher interest rate than if you had applied for the loan with only your information. If you and your spouse have a joint loan, the law requires that the lender report the loan on each of your credit reports.
Will this Affect Me Even if We Get Divorced?
The easiest way to make sure that you’re partners financial decisions don’t fall back onto you in the long run is by getting a prenup! By outlining all of your finances with through financial disclosure and negotiating the terms of how your prenup, you can make your best effort to make sure that any previous debt and debt during marriage from one of you, won’t follow you after the fact.
How Can I Help My Spouse Improve Their Credit?
It is possible to assist your spouse in improving their credit. You can help your spouse improve their credit by reviewing your credit reports periodically to determine if your budget needs any adjustments. You and your spouse can work on your credit by paying any collections that appear on your credit report, keeping the amount of your revolving credit card debt low, or working with a credit repair company if you want.
Should I Get a Prenuptial Agreement?
Well first, it’s important to understand what is a prenuptial agreement? A prenup is a contract that lists out all the terms you agree to abide by in the event of a divorce and details the assets that you hold as a couple or individually and remember, prenups are for everyone, not just those who feel like they are at most risk. Getting a prenup can give you and your partner peace of mind so you can focus on what’s most important – building your new life together!
How Do I Get a Prenup?
By HelloPrenup you can create an affordable, collaborative, and quick prenup from the comfort of your own home! Want to learn more about how HelloPrenup works?
Julia Rodgers is HelloPrenup’s CEO and Co-Founder. She is a Massachusetts family law attorney and true believer in the value of prenuptial agreements. HelloPrenup was created with the goal of automating the prenup process, making it more collaborative, time efficient and cost effective. Julia believes that a healthy marriage is one in which couples can openly communicate about finances and life goals. You can read more about us here Questions? Reach out to Julia directly at [email protected]