Financial Associations on Credit Files

SGE1

Hello all,

Is a financial association on a credit file generally seen a good thing? I'm filling out forms for Equifax and Experian, to get my credit files from them, and I have the option of putting my partner's details on it. In the past I've stayed clear of creating association (so no joint accounts for example, we have a account which is joint for all intents and purposes, ie we both use it, but it's under my name only)

My partner has a better credit rating than I do - he's older, has had a loan in the past (and successfully repaid it, on time etc), and has a credit card; my credit rating is not great, but only because I'm young (23) and have never had any credit.

I don't want to create a financial association that will be to my partner's detriment, BUT, since we plan on applying for a mortgage in about 18 months time, if it is more likely to improve my file rather than damage his, maybe I should go ahead and put his details down to create the association.

Thoughts?

YorkshireBoy

I wouldn't 'choose' to create a financial association. Just enter your own details.

Money_Man

You will create a financial link / association when you apply for the mortgage product in any case. Really nothing to worry about, particularly since you state his credit has been ran fine. No lender would ever tell you they declined your application based on someone elses credit information although undoubtedly this does actually happen in certain circumstances.

SGE1

YorkshireBoy wrote: »

I wouldn't 'choose' to create a financial association. Just enter your own details.

Sorry, not sure if I understand... I can, in effect, 'choose' whether or not the association is made, by deciding whether to fill in my partner's details. The credit agency forms include a box on 'parner/spouse details'. This statement follows:

"By giving these details you're confirming that you are financially associated with this person. Equifax will update your records to show you are connected to this person at your current address. This is called an association."

If you're saying I shouldn't bother, can you explain why?

SGE1

Money_Man wrote: »

You will create a financial link / association when you apply for the mortgage product in any case. Really nothing to worry about, particularly since you state his credit has been ran fine. No lender would ever tell you they declined your application based on someone elses credit information although undoubtedly this does actually happen in certain circumstances.

OK, so I guess it won't damage his rating, but any chance it will improve mine? I could do with being associated with someone who is seen to have handled credit well. I've been rejected for credit in the past (rather infuriatingly, by my own bank to said I used my agreed interest-free overdraft too often), and if it'll help me, I may as well.

Also, any chance that when applying for a mortgage, lenders believe that financial associations that have been around for longer indicate more stability, and therefore a greater likelihood of timely repayments? Or am I just splitting hairs?

Money_Man

Ok if you opt then both your information and your partners can be seen by the lenders when they search your file, it up to you to determine whether you think this is an advantage or not.

Money_Man

SGE1 wrote: »

OK, so I guess it won't damage his rating, but any chance it will improve mine? I could do with being associated with someone who is seen to have handled credit well. I've been rejected for credit in the past (rather infuriatingly, by my own bank to said I used my agreed interest-free overdraft too often), and if it'll help me, I may as well.

Also, any chance that when applying for a mortgage, lenders believe that financial associations that have been around for longer indicate more stability, and therefore a greater likelihood of timely repayments? Or am I just splitting hairs?

Yes potentially but if you are applying for a mortgage, they will consider income / affordability and both your ability to repay any loans before approving you.

CLAPTON

you seem very concerned about improving your credit rating... why ?
are you being refused credit ?

if it's bad enough to need significant improvement then it will almost certainly 'un-improve' your OHs

I'm with Yorkshireboy here... on the precautionary principle wait until you need to form an association (i.e. when you apply for a mortgage) and not before.

YorkshireBoy

Just to add to my earlier (short, sorry!) post...

1. As Clapton has said, you have nothing to gain...and also nothing to lose. Your partner, on the other hand, has nothing to gain and everything to lose.

2. Has your partner already got a financial association with someone else, that perhaps he's unaware of/forgotten? For example, an ex-partner, flat share bills account, student let? Maybe he once had a joint loan with one of his parents? How many people will you be associated with when you create an association with him?

3. Your relationship may end - and possibly due to financial problems - before you get to the mortgage application stage. You've created an unnecessary association which you then need to 'undo'...often in partnership with each other (difficult if things aren't pleasant!).

4. And finally, with regard to the guidance...

"By giving these details you're confirming that you are financially associated with this person..."

...if you say there's a financial association when there isn't one, you're lying aren't you? And deception to gain a pecuniary advantage (which is what you are seeking) is fraud.

SGE1

I am concerned about improving my rating; as I think I mentioned earlier, my own bank refused to give me credit, when I asked why, they came out with a dubious reason relating to the fact that I was using my student overdraft (which I was perfectly within my rights to do). I have been a customer with them for over 6 years, and have never missed any payments, so to think that even they won't lend me money is worrying. When I ask around about it, people seem to think it's purely down to my age (which I clearly cannot do anything about), and the fact that I haven't got any credit (which is an ironic vicious circle). I've checked my credit file once before, and nothing else stands out.

Re the fraud comment, I guess I would need to look up the legal definition. I'm confident that it wouldn't be fraud, eg. I'm sure some bills go out via my account by in both our names. Still I suppose you are right, best not to risk it.

All in all, thanks for all your suggestions and comments - I think I'll leave the box empty...