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Building and Keeping a Good Credit Rating

The ECOA gives women the right to their own credit if they are creditworthy. Creditors cannot refuse to grant you an individual account just because you are married. Also, you have the right to maintain an account in your birth name, your husband’s surname, or a combined surname. A creditor cannot make you re-apply for credit if your marital status changes.

In order to establish your own credit rating, you need to have an individual account in your name or a joint account in both your name and your spouse’s name. When reporting information to a credit bureau, a creditor is required by the ECOA to report the information in both spouses’ names on joint accounts.

If you are listed as a user on your spouse’s individual account, you are not responsible for the debt, but are not building up a credit history. Should your marriage dissolve, it may be difficult for you to establish credit unless you can prove that you participated in paying the bills. Therefore, if you are working and would qualify for credit on your own, you may want to consider applying for an individual account.

By combining the incomes of both spouses to support an application for a joint credit account, a married couple may qualify for credit or for more credit than they could obtain individually. However, you should be aware of some facts about joint accounts.

On a joint account, each party is responsible for the entire debt, not just half. This means that if the marriage ends in divorce, the creditor can come after either party for the whole amount. This is true even if under the terms of the divorce decree, the husband is responsible for paying off the debt. The creditor is not a party to the divorce settlement.

Thus, in order to maintain good credit, it is important to make regular payments on joint accounts regardless of who is responsible under the terms of the divorce settlement to protect your own credit rating.

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