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Owen Roberts

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For Richer, For Poorer

Posted: 9/04/2012 00:00

A friend of mine is getting married in June. We've received the very expensive-looking invitation, the wedding present list and the booking details of hotels close to the venue.

These days, weddings are an expensive business, but for some unfortunate couples, getting married can cost much more than just the big day. But marriage can be a case of till debt us do part if the two people concerned don't discuss their finances before they tie the knot.

I'm pretty certain my pal knows next to nothing about the financial situation of his bride-to-be; understandably, he's too caught up in the throes of love to sit down and ask her all about her credit record. But there comes a time when this sort of uncomfortable conversation has to be had for the sake of all concerned.

Over the past 10 years, I have heard enough stories of hidden histories to make me realise that before you combine finances with a loved one, it is absolutely vital that you know exactly what you're getting into.

After all, building a new life together costs money, and if you decide to pool your resources - say, by opening a joint account to pay the bills, or by applying for a joint mortgage on your dream home - you need to make sure that you know what is on your credit file, and work with it, otherwise it could come back to haunt you.

Say, for example, your intended has never told you that they have a County Court Judgement (CCJ) or bankruptcy against their name, or they've regularly missed payments on their credit card. Once your finances are linked with your partner's, you could find it harder to borrow money in future - even if you later apply on your own.

Despite this, one in 10 UK adults don't know how much their partner earns (something I find astonishing) and, shockingly, a third don't think their partner's credit history is any of their business. Off they go, full steam ahead to the bank to ask nicely for a mortgage...

...and then they find out it's bye bye dream home and hello mother-in-law's back bedroom, because they didn't know their partner had run up serious credit card debts during those heady student days and never actually made any payments at all on one of them. As a result, their credit rating is poor, and the bank won't accept them as a responsible borrower, only your salary will be taken into account, and the amount you thought you could borrow has drastically decreased.

Now may also be the time to start worrying about that joint account you opened without checking your individual credit reports - because yours may have been affected by your partner's financial past.

Interestingly, 5% of people who got divorced last year cited money as the sole reason -it seems that something borrowed often leaves most couples feeling blue.

It's vital that couples take into account the financial strengths and weaknesses of the person with whom they're going to share all their worldly possessions. Often, just being honest and knowing in advance what you've got to work with can be enough to stop a poor financial past becoming a difficult financial future.

Getting married and buying your first house is undoubtedly an exciting time, and I wish my pal and his new wife many happy years together - but I hope all their surprises are little ones, and not the financial variety.

 

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