(Closed) Finance and Marriage: questions, debt, loans, credit scores…

posted 10 years ago in Married Life
Post # 17
Member
165 posts
Blushing bee
  • Wedding: September 2010

I used to work in a financial institution where I did loans and worked with people’s credit…

If you have good credit and your SO has bad, does his credit score affect yours once married? No. Credit scores and credit reports do not merge. Credit reports are based on one person’s name, date of birth, and social security number so they are never joined.

– If your SO have unpaid loans and debt and you have a clean bill, once married does his debt and unpaid loans become your problem as well? This depends by state. Wisconsin is a marital property state so once married, even if one spouse has no debt and they other has a lot of debt, the spouse is also responsible for the other’s debt.

– If he takes out a new loan or accrues new debt after married, is that now your problem because you were married before the new loan/credit/debt? Again, depends on the state in which you live and is the same answer as above. If you are in a marital property state you will actually be notified if your spouse opens up a new account.

Can our finances, credit scores, loans, and such truly be completely separate when married based on law?  Clearly managing separately once married is a task and responsiblity onto ourselves, but if we can do it, does legality issues see it the same way? This is the same answer as the last two questions. If you are in a marital property state, his debt becomes your debt (but it doesn’t affect your credit score, you are just responsbile to pay his debt if he doesn’t). If you don’t live in a marital property state, and don’t have any joint accounts or assets, then your finances are truly separate.

Post # 18
Member
523 posts
Busy bee
  • Wedding: December 2009

“If your SO have unpaid loans and debt and you have a clean bill, once married does his debt and unpaid loans become your problem as well? This depends by state. Wisconsin is a marital property state so once married, even if one spouse has no debt and they other has a lot of debt, the spouse is also responsible for the other’s debt.”

This is inaccurate.  Perhaps Wisconsin has modified this by statute, but I doubt it.  Generally, even in community (aka marital) property states, property owned or debts owed PRIOR TO the marriage remain the separate liabilities of the spouses.  The problem you are talking about arises in community property states when (a) spouses misguidedly add each other as joint owners to prior savings accounts, or (b) assets are accrued by the debt-free spouse during the marriage, because most incoming assets are by default owned jointly in community property states.  Joint assets can be used to pay the prior liabilities of either spouse, but separate assets cannot be used to pay prior debt.  The prior debt itself remains separate, and the prior savings accounts (so long as you don’t choose to make them joint or [possibly] deposit anything earned after the marriage in them) remain separate.  Inheritances also still remain separate in community property states, unless modified by the individual state.

The OP is in a separate property state, so she shouldn’t worry about this unless she plans to move out west.

Post # 19
Member
529 posts
Busy bee
  • Wedding: October 2009

@chicagobride092010, your statements of

A few of the posts in this thread are wrong on several points.  I don’t know why people who’ve never stepped foot into a property or family law classroom feel the need to increase their post count.  I actually know a bit more about this because I have studied this

are pretty rude.  I don’t think anyone posted just to “increase their post count.”  I think most everyone pointed out that they were NOT experts, so their advice should be taken with a grain of salt.  The OP asked questions, and people tried to answer to the best of their ability and give them the knowledge that they knew (or thought) to be true, and what their own experiences was.

Post # 21
Member
523 posts
Busy bee
  • Wedding: December 2009

@Adira.  I fully intended to be abrupt.  Misinformation and less than full (all the potentially distinguishing facts) recounts of personal experiences are potentially damaging in an area like this.  And I’m not sorry for pointing that out. 

And I agree with you mmuncha.  You are being responsible to ask these questions.  Asking these questions does not mean you are even considering the possibility of divorce (which everyone should also do).  Protecting your assets from your FI’s creditors can protect your well being, his, and your marriage in the long run.  Why pay more than you legally have to, seriously?  But, please, please seek help from a licensed attorney who specializes in marital law or estate planning in the tri-state area.  And do that before making any of your current, separate assets joint, for the reasons I explained.  He or she will be familiar with the local rules and would be able to help you both get squared away in a matter of hours.  Even if the billing rate is $300/hour, a couple of hours worth of attorneys fees are probably nothing compared to the amount of assets he or she can help you BOTH protect from past creditors.

Post # 22
Member
529 posts
Busy bee
  • Wedding: October 2009

@chicagobride092010 – I agree, that with questions like this, it’s important to get the facts, and maybe recounting personal experiences is not helpful.  But I think you could have made your point without being so insulting.  That was ALL I was trying to say.  I don’t think you have to be sorry for pointing out flawed logic or misinformation.  But I do find it offensive that you insinuated people are posting just to “increase their post count”.

Post # 23
Member
2394 posts
Buzzing bee
  • Wedding: April 2010

@chicagobride – You make a good point, but your tone is a bit much.  No one implied that you should refrain from making a perfectly valid observation – only that there’s no need to do so from the vantage point of a remarkably tall horse.

And unless you’re willing to go look up the relevant Wisconsin statute (or lack thereof), perhaps it would be wise to refrain from correcting a person who has practical work experience in the relevant area as to his or her understanding of regulations with which she deals on a daily basis. 

Post # 24
Member
5976 posts
Bee Keeper

I think it’s best that you find a licensed attorney in your state that specializes in this type of financial law.

I think it’s incredibly smart of you to be asking these questions now, and it’s responsible of your Fiance to let you know that he was a bit reckless in his youth with his finances and debt. The first step in a successful marriage is communication, and you have that down pat with communicating your issues with each other.

Good luck and hope you find the answers you are looking for!

Post # 25
Member
523 posts
Busy bee
  • Wedding: December 2009

Pot, kettle, black.  Teaad, perhaps until you have gone to law school and taken a class in this, it would be wise for you to refrain from correcting someone who has regarding the most basic, fundamental rules of community property.  By the way, I was correct.

Post # 26
Member
2867 posts
Sugar bee

Whoa, @chicagobride.  You may be right but you’re certainly not coming across very nice.

To the original poster, I know financial security is important to you.  However, maybe postponing getting married until all of his debt is paid will make you feel better?  It’s just an idea.  I think that seeking a financial advisor for him and just bouncing these questions off them would help you?  There are low cost financial advisors out there!  Good luck!

EDIT: I just want to say that yesterday a fellow bee asked for tax advice and I gave her some info, but I was wrong with some of it and another bee corrected me with proper urls and everything.  She was totally nice about it.  There’s a way to say you know something and to correct people without insulting them.

Post # 27
Member
683 posts
Busy bee

Ladies, ladies. Let’s keep it civil. It’s not like we’re talking about open vs. cash bar. Laughing

Post # 28
Member
1023 posts
Bumble bee
  • Wedding: June 2010

Chicagobride you are being a bit ridiculous right now. I mean, people are just trying to be helpful. By The Way taking a class does not an expert make. You may be right, but its difficult to listen to someone who is being absurdly snotty.

Post # 29
Member
2626 posts
Sugar bee
  • Wedding: December 2009

Not sure on the legality side of things, but in our marriage, we look at it as what’s yours is mine and what’s mine is yours.  I have more debt than my DH and while he says it’s now “our” debt, I’m still paying for it out of my paycheck.  We kind of divided things up.  I’m the official debt payer offer (will include his debt in my payments) and he’s the saver upper. lol  This works out great because I’ll be paying off the debt that I’m responsible for, he’ll be saving and we can get to our goals quicker.  I know some people take the side that “nope, that’s your debt, I’m not helping pay it off.”  But, let’s say you were wanting to buy a house, have kids, buy a new car, etc, but needed to get that debt paid off, I’d want to knock that crap down right away so you can get to the goals quicker…but that’s just me. 

Post # 30
Member
523 posts
Busy bee
  • Wedding: December 2009

I am just trying to be helpful.  I did that by correcting where I could, giving an overview of the default rules, stating at which steps she’s fine, and at which steps (like before converting separate assets to joint, or prior to moving to a community state) it’s really important to seek a local attorney’s help.  And I think it’s helpful to point out, sternly if necessary, that the best way to be helpful in potentially consequential matters like this is to not comment when the other alternative is providing misinformation.  Law is not always common sense and bunnies.  I would hope that someone would sternly smack me down if I said anything about a tax issue.  Despite years of personal and professional practical experience, I lack a firm grasp of the legal basics, to the point where I could lead someone to miss a big issue and cause serious financial harm.

And my pot calling the kettle black remark was entirely deserved.  I don’t appreciate being told to shut up about my correction re: community property in WI, just because I don’t have practical experience there, by someone who hasn’t even studied marital property.  I’m even more irritated thereby when what I said was accurate, stuck to the basics, and was not disparaging of the WI poster’s understanding of the law (it was, although not accurate, a wise observation because it is partially true).

Post # 31
Member
529 posts
Busy bee
  • Wedding: October 2009

@chicagobride – no one is telling you that you pointing out facts or pointing out faults is wrong.  We are simply pointing out that your tone is rude and some of the things you’ve said have been insulting.  You may be correct in every point you made, but being rude to people isn’t a great way to make your points.

But I think that’s the third time I’ve stated that, so maybe I’m not getting my point across, or maybe you don’t care.  Eitherway, hopefully the OP got some good advice and is seeking out the correct information so she can make more informed decisions.

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