How relationships can affect your credit report and score
When you apply for finance with someone, for example a joint credit card or mortgage, a link is automatically created on your credit report. This is known as a ‘financial associate’. Once you are linked with this person then it is possible that their credit report will also be taken into consideration for any future credit application you may make.
Before you enter into financial association with anyone, it’s vital to be open and honest with each other about your financial commitments and credit histories.
When do you become financially linked?
The only way to become financially linked with someone is by entering into a joint financial agreement with them, for example by getting a joint mortgage or credit card. They will then appear as a financial associate on your credit report.
Just because you marry someone, it doesn’t automatically make you financially linked with them – this only happens if you apply for a joint credit account together.
How do I get a financial link removed?
If you wish to remove a financial associate from your credit report, then there are certain steps you can take.
- A financial association cannot be removed while joint accounts are open. They will need to be closed or transferred to an individual account. Once done, you can ask credit reference agencies to place a notice of disassociation on your credit report, which should prevent your former associate’s actions from affecting your credit report and score in the future.
- If you get a divorce or break up with someone, you’re still financially linked to them. Until all joint accounts are closed and the financial association removed, their actions – such as taking out new finance – could impact your credit rating too.
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