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Ask the Credit Counselor
Q: I am getting
married soon. My credit is great, but my husband can’t even get a credit
card in his own name due to past credit problems. How will his credit
affect mine?
A: The good news is that the credit histories of spouses are not merged.
In fact, it is possible to keep your credit history completely separate
from your future husband’s, as long as you don’t add each other to your
existing accounts or get new credit in both your names.
Keep in mind, though, that if you live in a community property state
(Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas,
Washington, Wisconsin) debts incurred by either spouse during the
marriage are considered community property. That means if he does start
qualifying for credit again, you could be responsible for any debts he
incurs while you’re married.
Also be careful about helping your husband rebuild his credit by
cosigning new loans with him. By cosigning, you will be entirely
responsible for those loans or credit cards. I may sound a bit cynical,
but I see these problems all the time. While your betrothed may have
told you his poor credit history was due to circumstances beyond his
control (and that may be true), my experience is that most people with
credit problems don’t learn the skills they need to keep them from
repeating their failures.
It sounds like you and your husband have different approaches to
handling money. It’s best to sort those issues out before you tie the
knot, since money challenges are cited as the number one cause of
divorce. Before you walk down the aisle, run – don’t walk – together to
a money management course where you can learn how to see eye to eye on
this important issue.
Q: Over the past two years I was unemployed and working temporary jobs.
I ran up about $20,000 on five credit cards. I am working again
full-time and need to lower my interest rates and get on a regular
payment schedule. I’ve considered credit counseling, but wonder if I
shouldn’t just try to negotiate lower interest rates on my own. Why not?
A: It’s very important for consumers to keep the lines of communication
open with their creditors if they are experiencing problems making
payments. At the same time, I doubt you’ll be able to negotiate the same
terms that a counseling agency can.
There are several reasons why. First, creditors know when someone enters
into a counseling program that they are making a serious effort to repay
their debt. Consumers in a counseling program, for example, agree not to
take on additional debt. Secondly, creditors know they will be treated
fairly when a consumer is in a counseling program. Without the
counseling agency as the “go between,” consumers might feel pressured to
pay one creditor (you know the “squeaky wheel” adage), which could mean
other payments slide. Finally, the counseling agency takes on the
responsibility of making monthly payments to each participating
creditor. That makes it easier for you, since you only have one monthly
payment to make to the counseling agency, but it also means the creditor
knows they can get a reliable answer from the agency if a payment isn’t
received on time. Together, all this means that most creditors feel much
more comfortable negotiating with a professional credit counseling
agency instead of directly with consumers.
This article is the property of
www.bestcreditcardsonline.com,
which has been offering credit cards services since 2002.
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