A wedding is a day to create memories for life. When the countdown to your marriage to your loved one draws near, you set out to prepare every little thing about your marriage. The first thing any couple would do is budget the finances for the big day.
A wedding in India tends to be a lavish affair, and every couple would like to make the most of it by spending on the wedding of their dreams. Due to the multiple rituals and customs expenses at a wedding, and to fulfill them, most couples tend to opt for a wedding loan. Every time you apply for a loan, banks check your creditworthiness and credit history. A few questions might come to mind at this point: Will your credit score be affected after marriage or will a spouse loan be possible to finance your marriage?
We help you break some common credit score myths.
Myth: Marriage will affect your credit score
Truth: A sacred marriage alliance does not mean that your credit score is affected if your partner has a different credit score. You must be assured of this fact.
However, there are situations that will affect your credit score. A loan applied via a joint account will be the responsibility of both partners. The lender will collect from both partners in the event of default. If you both fail to repay on time, it will eventually affect your credit scores.
Myth: Your partner’s credit rating will impact your chances of getting a marriage loan
Truth: Planning a dream wedding and not having enough funds can put you in a difficult position. If you are considering taking out a credit card or loan to cover expenses, there are a few things to keep in mind. The lender will check your credit scores on an individual basis. If you decide to take out a loan with your partner, and both of you have good credit scores, the approval will go smoothly. However, if one or both of your credit scores turn out to be bad, your application may not be successful.
In the event that an application is approved, the interest rates and fees would prove to be higher, unless the partner with the higher credit rating applies separately.
Myth: Any name change will affect the credit score
Truth: If a name change occurs after marriage, it’s reassuring enough that it doesn’t affect your credit score; a name change on the PAN card will also not affect your credit score. However, it is imperative to inform the development lender so that it can be reflected in all other official documents. It would help you acquire credit after marriage.
Once you have exchanged your vows, your financial responsibilities are evenly distributed. It’s important to stay on top of your partner’s credit rating before making joint financial decisions because, after all, it will pave the way for a happy marriage.
Author is MD, Business Intelligence at Experian Asia Pacific