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Credit facts to know before getting married

RBL Bank Jul 21, 2020

Powered by TransUnion CIBIL

You must have noticed that married couples in your generation are more focused on their dreams than your parents’ generation. They make plans for a home, a car, or vacations before their wedding. A big reason is the easy access to credit facilities. One of the main factors that work towards easing this availability is a high credit score.

If you’re wondering what happens to your credit score when you get married and start making joint accounts, here’s some news for you- your personal credit score will remain unaffected. Both spouses will continue having their own credit scores and credit records.

Now comes the next set of questions. What if there is a big difference in both your credit scores? If yours is the better credit score then you alone might be a good candidate for availing credit. Should you both instead try to work towards having a good score for each and then apply for credit jointly? When it’s the family’s finances in question, you want to be sure about every step you take. If a perfect score is what it takes, you work towards it for fulfilling their dreams.

In the age of easy credit and increasing prevalence of it, you need to be aware of how it can have an effect on your financial future and your goals. So before you and your spouse start having the crucial conversation about credit, financing, and loans, here are the top three things to keep in mind.

1. Applying for a joint loan? Check your scores:

You both have a lot of dreams such as a home, and a shiny car that you want to fulfill together. The first step is to decide who should take a loan and whether you should apply individually or jointly? It sounds a little precarious since you have made a commitment to take every step of your lives together.

However, before you apply for a joint loan, you both need to know each other’s CIBIL score, credit habits, and individual financial responsibilities. You both should know what you’re signing up for. This includes past defaults, past and current loans, outstanding payments, etc.

Pro tip: Apply for a joint loan only if each of you have a good credit profile and credit score. If one of you has a low credit score, take some time on improving it and then apply. Or else, the one with the higher score can always apply individually.

2. Keep track of each other’s credit habits:

Having credit available as instantly as it is today, comes with its set of positives and negatives. It is a good chance to work towards a good credit profile if you pay back on time. However, it is very tempting to spend from multiple credit cards and loans for buying your favourite things. It would be wise to keep a check on each other’s credit spending and reduce credit transactions the moment you notice a risky rise in credit payments or when credit is about to reach its limit.

A good EMI to Income Ratio to maintain is less than 30%. Basically, keep your credit usage to less than 30% of your monthly income. This helps in achieving a good credit score.

3. Evaluate and follow up:

You usually maintain a check on your spending and saving and probably even record each transaction. Why not do the same with your credit reports too? A good credit score can help you in times of need and even for fulfilling long-term dreams. A good way to work towards it is to keep track of it, and that of your spouse too. Teamwork makes the dream work, doesn’t it?

Check your credit report and credit scores on a regular basis so that you can rest assured about borrowing when you are in need.

Click here to check your latest CIBIL Score for free.

Disclaimer: Articles published on the website are merely indicative and suggestive in nature and do not amount to solicitation. The contents do not guarantee the desired returns and/or results. Reader is advised to exercise discretion and consult independent advisors for achieving desired result. Visitors to this blog/ website w.r.t products & services offered by RBL Bank Limited herein, shall ensure that the comments / feedback posted shall be restricted to the contents published herein and shall not contain such language that may be un-parliamentary or against any religion, caste, section of society, political view etc. While our endeavor is to publish the comments that are submitted, however, all comments/feedback shall be subject to internal review by RBL Bank Limited. We do not guarantee that the comments that are submitted will be published.

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