Joint Account - Credit rating effects

ColuGav

Hi there,

I currently own a joint account with my flat mate who is having a few money issues.

Our account has no overdraft available and as such we have no shared credit applications/facilities available.

I understand that there is going to be a financial association between us, however I'm not sure what the impact on my credit rating would be...

Is this just a how long is a piece of string question, or is the fact we have no joint credit applications better than if we did?

Thanks in advance!

Gav

YorkshireBoy

ColuGav wrote: »

is the fact we have no joint credit applications better than if we did?

In opening the current account you've made a "credit application".

Your flatmate will drag your rating down towards theirs, so sever the link as soon as possible would be my advice.

ColuGav

Is a current account a credit account / application though?

What with there being no overdraft and such like?

CLAPTON

check your credit files (all three) immediately (today would be good) and see whether you are associated with him

in any event break the association by closing the shared a/c asap (today would be good)

completely mad to share accounts with anyone except maybe the father/mother of your children

YorkshireBoy

ColuGav wrote: »

Is a current account a credit account / application though?

What with there being no overdraft and such like?

Fundamentally, if it wasn't a "credit account" it wouldn't appear on your credit report.

But the answer to your question is yes, because your account has the potential to go overdrawn, with offline debit card transactions, DD/SO transactions paid (or unpaid with fees charged), etc

ColuGav

YorkshireBoy wrote: »

Fundamentally, if it wasn't a "credit account" it wouldn't appear on your credit report.

But the answer to your question is yes, because your account has the potential to go overdrawn, with offline debit card transactions, DD/SO transactions paid (or unpaid with fees charged), etc

Ah good point, hadn't thought of that!

In regards to Clapton's post, It was opened because it made things easier to manage with regards to household bills etc...

CLAPTON

ColuGav wrote: »

Ah good point, hadn't thought of that!

In regards to Clapton's post, It was opened because it made things easier to manage with regards to household bills etc...

indeed so, many/most joint accounts are opened for the obvious convenience but time to close now

InsideInsurance

TBH, the amount of impact it will have is debatable - though for other reasons it may be sensible to close the joint account.

I, unknowingly, had a joint loan with someone who went on to have defaults and an IVA and despite that I've never had any problems getting tier 1 credit and high limits (with the one exception being with MBNA but on the basis the link is broken now and MBNA still wont give credit I assume something else is going on there)

YorkshireBoy

InsideInsurance wrote: »

TBH, the amount of impact it will have is debatable

Late payments from 1996/97 (mainly 1's but a couple of 2's as well) on a financial associate's credit file nearly cost me a decent re-mortgage in 2001.

Hasn't credit scoring tightened up since then? If not in the early part of the last decade, certainly since 2008?

though for other reasons it may be sensible to close the joint account.

What sort of "other reasons" (other than the obvious possibility of one person emptying the account and doing a runner)?

InsideInsurance

YorkshireBoy wrote: »

Late payments from 1996/97 (mainly 1's but a couple of 2's as well) on a financial associate's credit file nearly cost me a decent re-mortgage in 2001.

Hasn't credit scoring tightened up since then? If not in the early part of the last decade, certainly since 2008?What sort of "other reasons" (other than the obvious possibility of one person emptying the account and doing a runner)?

One of the main problems is that it doesnt even have to be that account they empty. If the other party has other accounts/ loans/ credit cards with the same bank and default on those then the bank can take the money from the joint account to cover the debts as well as potentially black listing you and calling in all your debts with the bank despite your accounts all being well managed (as happened with me).

I cannot say what exactly the impact is of having someone with bad records associated. As I say, during the 3 years I had an associate that I didnt know I had and during that time had multiple defaults and an IVA I was still able to get new CCs with over £10k limits, PCP on a luxury car etc which would suggest to me that it is evidently not so massive that if you have a good history and strong position outside of the history that the associates history can result in you being declined

CLAPTON

InsideInsurance wrote: »

One of the main problems is that it doesnt even have to be that account they empty. If the other party has other accounts/ loans/ credit cards with the same bank and default on those then the bank can take the money from the joint account to cover the debts as well as potentially black listing you and calling in all your debts with the bank despite your accounts all being well managed (as happened with me).

I cannot say what exactly the impact is of having someone with bad records associated. As I say, during the 3 years I had an associate that I didnt know I had and during that time had multiple defaults and an IVA I was still able to get new CCs with over £10k limits, PCP on a luxury car etc which would suggest to me that it is evidently not so massive that if you have a good history and strong position outside of the history that the associates history can result in you being declined

was the association showing on your credit files?