Your credit file could be severely affected by your ex partner if you have joint credit agreements and there are some extremely important things you should be aware of.

Sometimes relationships don’t work out quite as we had anticipated. And among all the other issues left to sort through and deal with, a join bank, or credit account can often be overlooked.

If, further down the line, your ex partner finds themselves in financial difficulty it could have serious implications for your own credit score.

In this short guide we’ll explain why your credit files become linked and how you reverse it.

Why would it affect a lender’s decision?

When you apply for a joint credit agreement with someone for a mortgage or  loan, a link is is created on both of your credit reports. This is referred to as a “financial associate”.

Once the link is formed with this person, it is possible for a lender to take their credit history into account when making their decision on your credit application, any further credit application you make there on after.

If the person you have applied with have a poor credit history, it can have a damaging affect on your credit score, in some cases reducing it. A lender can see them as a higher risk to pay back the money borrowed.

If they did default, the lender is perfectly within their rights to chase you for the full amount not just your half and they could determine you would struggle to pay back the money on your own, if that were the case.  

Weighing up all these factors, a lender’s decision can be affected.

Does marriage or cohabiting link my credit file?

No, the only way your credit file can be linked is by entering into a joint credit agreement with someone else. For example, by applying for a mortgage or loan with them. It would then appear as a financial associate on your credit file.

By marrying or moving in with someone, it doesn’t automatically link your your credit files – only if you apply for a joint credit account with them.

I applied for a loan on behalf of my partner, are we linked?

No, in this circumstance you have applied for the loan solely in your name. Although, it may have been for your partner, regardless of how they spent the money, the liability would always be yours and therefore your credit files are not linked.

We have a credit card account with a card each, are we linked?

No, you cannot jointly apply for a  credit card. The liability for the credit card is the named account holder.. You can add an additional card holder to your account, but the only responsibility to pay back the money, from a lender’s point of view, is the person who signed the credit agreement.

How do I remove a financial link?   

To move a financial link from your credit report there are certain steps you need to take:

  • You cannot remove a financial association from your credit file if a joint account is still open. You need to close the account and transfer it to an individual account. Once this is done, you should ask credit reference agencies to place a notice of disassociation on your credit report. This should prevent your former associates future actions affecting your credit score.
  • If you go through divorce, or split up from a partner, you’re still financially linked to them. Until all your joint accounts are closed, and the financial association removed from your credit file, their future actions, such as taking out more finance, could impact your credit score.

Final word

In short, if you are sure your relationship is over it is safer to act as quickly as possible. The worse possible thing to happen is for somebody else’s bad decisions affecting your credit score and financial well being in the future.

Have you ever had any issues with joint credit accounts?

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