Working With a Spouse to Build Better Credit

Credit histories don’t merge when two people get married, but there are still ways that spouses can help each other build better credit scores. It’s important for both spouses to have good credit, especially when you plan to make major purchases together, like a house or a car. One spouse’s bad credit could mean you both have to pay a higher interest rate or credit card or loans, or worse that you may not be approved at all. Here are some ways to work together to build a better credit score and work toward credit repair if it’s needed.

Review Your Credit Reports Together

Before you start working on your credit, figure out what’s on your credit history. Every person is entitled to a free credit report once a year from the three credit bureaus. You can get these credit reports through AnnualCreditReport.com, not through the credit bureaus.

Once you have your credit reports, go through them to be sure that everything is accurate. If you find anything wrong – for example, accounts that don’t belong to you – you can have the information removed by using a credit report dispute.

Pay Off Past Due Accounts

Getting rid of negative credit report information is key to improving your credit histories. With two incomes, you and your spouse can make more progress paying off past due accounts than you could make all by yourself. Make a list of all the past due accounts between you and your spouse and decide which accounts will be paid first. For example, if there are accounts that are just a little past due take care of those first so you can keep them from being charged-off.

Get Joint Credit Cards

By getting a joint credit card, one spouse can use their good credit to help the other spouse improve their credit score. When you have bad credit, it can be difficult and almost impossible to get a credit card alone. But, when you have a cosigner that does have good credit, credit card companies are more willing to approve credit card applicants. Since you can use both spouses income on the credit card application, you may get approved for a credit card with a high credit limit. Higher credit limits are good for your credit score, when you don’t use them.

When you share a credit card, make sure you set some ground rules on how you’re going to use the card. For example, is there a maximum spending limit each spouse can make without consulting the other spouse? Work out other details, too, like who’s responsible for making sure the bill is paid every month.

Create a Budget Together

Simply having a budget won’t affect your credit score, but it will reinforce the healthy spending habits that do help your credit score. Even if two spouses don’t have a budget together, each spouse should have their own budget. Make sure all the monthly expenses, especially credit cards and debt expenses, appear on someone’s budget. The only “right” way to budget is the way that works best for you and your spouse.

As the saying goes, “Two heads are better than one.” Two people working toward a common goal of better credit can be much easier than one person working on their credit alone.

Ed O’Brien is a seasoned writer with a strong background in business and personal finance. His blog, Credit Repair, offers free advice to those seeking ways to improve their credit scores.

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1. What is the Best Credit Score?
2. How to Raise a Credit Score
3. What to do to Fix Your Credit Report
4. What Can Raise Your Credit Score? Try Using Credit Cards!
5. 18 Tips on Using a Credit Card Rewards Program

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Tagged as: credit bureau, credit counseling, credit history, credit repair, credit report, credit score, poor credit history