When deciding whether to pop the question ― or agree to a proposal ― it's important to consider how debt can alter the relationship. From a legal standpoint, bringing debt into a marriage doesn't mean the other spouse becomes liable for it. That remains the responsibility of the person who accumulated it.
Do You Inherit Debt When You Get Married? No. Even in community property states, debts incurred before the marriage remain the sole responsibility of the individual. So if your spouse is still paying off student loans, for instance, you shouldn't worry that you'll become liable for their debt after you get married.
Marrying a person with a bad credit history won't affect your own credit record. You and your spouse will continue to have separate credit reports after you marry. However, any debts that you take on jointly will be reported on both your and your spouse's credit reports.
Combine your finances once you're married.
If you're just dating or engaged, don't pay anything on the other person's debt until you're married. Just keep paying on your own debt (if you have it) or save up a pile of cash if you're already debt-free.
In most cases, an individual's debt isn't inherited by their spouse or family members. Instead, the deceased person's estate will typically settle their outstanding debts. In other words, the assets they held at the time of their death will go toward paying off what they owed when they passed.
In common law states, debt taken on after marriage is usually treated as being separate and belonging only to the spouse who incurred them. The exception are those debts that are in the spouse's name only but benefit both partners.
If your spouse has a bad credit score, it will not affect your credit score. However, when you apply for loans together, like mortgages, lenders will look at both your scores. If one of you has a poor credit score, it counts against you both.
Although it may be uncomfortable to bring up your financial obligations, waiting too long could make the debt into a much bigger deal than it is. Your partner could feel you've betrayed their trust, especially as the truth will come out eventually if you do move into a long-term relationship.
Your spouse's bad debt shouldn't have an effect on your own credit score, unless the debt is in both your names. If you've taken out a credit agreement together, for example, on a mortgage or joint credit card, then your partner will be listed on your credit report as a financial associate.
Keep separate bank accounts, take out car and other loans in one name only and title property to one person or the other. Doing so limits your vulnerability to your spouse's creditors, who can only take items that belong solely to her or her share in jointly owned property.
But how much debt is a deal breaker? Overall, men are willing to be with a partner who owes up to about $40,000, Finder found. The cutoff for women is lower: just over $34,000. Finder surveyed more than 1,600 adults in the U.S. in January.
Furthermore, if you've married someone with bad credit, paying off their debt could improve their credit by reducing their debt-to-income ratio. This could later help the two of you qualify for a shared loan, like a mortgage.
Fortunately, your spouse's past credit history has no impact on your credit profile. Only when you open a joint account will any information be shared on both of your credit reports. However, when you want to buy a home together, your spouse's negative credit history could impact your mortgage rates.
One of the most important legal changes that occurs when you get married is the acquisition of “marital property”. Whether it is a house, boat, car, television, or just a coffee mug, any asset that is acquired by either spouse during the marriage may treated as a marital property in a divorce.
Ultimately, whether or not you help your new spouse pay off their debt is completely up to you. There are many ways to tackle debt and to work together with your spouse. You could pay your joint bills while they pay off their debt. You can focus on saving and investing while she knocks out her own student loans.
It's also important to tell them if you are considering making a life changing decision together, such as buying a house or getting married, because your finances will be looked at by credit agencies and mortgage lenders and this is when issues can come up.
(8) From that same verse, we have our second topic, “The Love Debt.” It becomes clear that, while we can strive not to owe anything, there is something we cannot but owe and that thing is LOVE. This means love is a debt which we naturally owe one another in the family, especially in the house of faith.
I take this to mean basically someone with a ton of debt that isn't student loans or a mortgage. And shocking, women don't want your baggage. 2.
The rule of thumb is to have roughly the equivalent of your annual salary in savings by then, experts say. If you earn $50,000 a year, for example, you should aim to have $50,000 put away.
Talk about debt when the relationship gets serious.
“Even if you're not legally bound, if your relationship is at a stage where you have joint goals and you can see a future together, it needs to be discussed,” said financial planner Cristina Guglielmetti, president of Future Perfect Planning.