Future lifestyles and Credit Checking

With one in the three married couples expected to divorce and even higher ratios of co-habiting couples likely to end their relationships, what happens in the aftermath if one of the ex partners falls into debt or refuses to settle outstanding debts, or if you’re a tenant pay the rent?

The possible outcome is that the ex partner in this scenario could become a bad credit risk and therefore, by default have a bad credit rating if they wish to borrow in the future. The problem arises, however, if the couple when they were together borrowed jointly and the other partner who is debt free and has a good credit rating wishes to borrow in the future. Why? Unless each partner dissociates themselves when the relationship ends, they will be deemed still together from a financial perspective and more importantly a credit reference agency viewpoint.

One way to avoid such a scenario is to request each credit agency to add a notice of dissociation to their credit file. Most if not all credit agencies are more than willing to provide advice and assistance with such enquiries. Another method worth considering is to check your own credit file which most of the credit reference agencies allow you to do for a small fee.

Please Note! YOUR HOME IS AT RISK IF YOU DO NOT KEEP UP REPAYMENTS ON A MORTGAGE OR OTHER LOAN SECURED ON IT. ALL SECURED OR UNSECURED LOANS ARE SUBJECT TO STATUS. SECURED LOANS ARE SECURED ON PROPERTY.