What Married Couples Need to Know About Credit Cards

Laws regarding marriage and credit can be complicated.

Laws regarding marriage and credit can be complicated.

The effect of getting a credit card after you get married can vary depending on whether you get a joint card or one in your own name. Whether your state operates under common law or community property laws also plays a role. If either you or your spouse has a spotty credit history, it can hurt your chances as a married couple to get the best interest rates on a credit card.

Common Law States

Most states operate under what is known as "common law" when it comes to the assets and liabilities of a married couple. In a common law state, if you get a credit card under your own name, you are solely responsible for its repayment. An exception is if you use the card to pay for joint family liabilities, such as education for your children or food and shelter for your family as a whole. With joint credit-card accounts, the law is clear-cut: You are both responsible for the repayment of the loan.

Community Property States

Nine states, along with Puerto Rico, operate under community property laws. If you live in a community property state, any debt either you or your spouse incurs after marriage is considered a debt of your estate as a whole. You are both responsible for its repayment. If your husband opens a credit card in his name and only makes charges for his personal use on the card, you are still on the hook for the repayment of the balance. Community property laws apply in California, Nevada, Idaho, Arizona, Washington, Texas, Louisiana, New Mexico and Wisconsin. Couples in Alaska can sign an agreement to have their debts treated as community property, but otherwise Alaska is considered a common law state.

Past Credit History

Regardless of the state you live in, any credit card debt your spouse incurred before you were married is still his sole responsibility. However, if you live in a community property state, any new debt either of you charges on the card after your wedding date becomes a joint liability. If your spouse missed payments on a credit card before your marriage, that won't affect your credit report once you get married. Credit reports reflect the credit histories of individuals, not couples, even after marriage.

Getting New Credit

Even if you have had good credit all your life, if your spouse has bad credit, it can hamper your ability to get new credit at good rates. If you apply for a joint credit card, your lender will look at both of your credit reports. Your spouse's bad credit may result in a credit denial or the issuance of a card with high interest rates.

Authorized User

If you have good credit, you may be able to help your spouse with bad credit by making him an authorized user on one of your outstanding credit card lines. As an authorized user, the account will appear on your spouse's credit report in addition to yours. A history of successful repayment on that account can help build your spouse's credit back up.

 

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