Marriage from A to Z

“Do you know about his/her credit?”

One of the things that can greatly impact a man and a woman as they join together in marriage is their credit history.  I know this is a topic that often gets neglected when two people are in love and planning to get married.  However, it is very important!  So whether your credit is good or bad,   it should be discussed before you say “I do.” You need to know the status of your own credit and the status of your spouse/prospective spouse.

I want to put emphasis on simply knowing.  I am not saying that you should know the status of a person’s credit to use it against them or to cancel them out as a spouse. I am saying that it would be good to know what you are working with before you say “I do.” Those of us who are already married understand exactly why I am saying this.   Each person needs to be honest about their credit. Honesty allows a person to be able to make better choices.  In some pre-marital classes students are asked to provide a credit report so there are no surprises.  There is nothing like going to make a major purchase and discovering that you can’t make the purchase because of a poor credit history.   If your credit is good, purchases will be made easy.  If your credit is bad, purchases will be challenging.  The good news is that bad credit can be made good over time.

Credit is defined as the ability of a customer to obtain goods or services before payment, based on the trust that payment will be made in the future.  If you are planning to spend the rest of your life with a person, find out their belief and behavior (conduct) in reference to their credit.  Some were never taught about credit and the value of having good credit.  Therefore, poor choices are being made.  This is something that we should teach our children (especially our teens) as early as possible.  The sooner we learn, the better decisions we can make as we grow older.

Here are a few facts about credit that we should know:

• Credit History – A record of a borrowers responsible repayment of debts.
• Credit Report – A record of the borrower’s credit history from a number of sources including banks, credit card companies, collection agencies and governments.
• Credit Scores – The information on your credit report is used to generate credit scores which are called FICO scores.
• FICO – Fair Isaac Corporation is the largest and best known of several companies that provide software for calculating a person’s credit score.
• FICO scores are broken down into the following:
  • 30% Accounts owed
  • 35% Payment History
  • 10% New Credit
  • 15% Length of Credit History
  • 10% Types of Credit
• There are 3 major credit reporting agencies:  Equifax, Experian and Trans Union.  (You can request a credit report from any of these)

Until next week  . . .

Carolyn

ps   (Follow me on Periscope:  Mon, Wed, and Friday around 6 or 7 @CarolynTatem)  This week we are discussing things you should know about your spouse/perspective spouse.