Does joint account affect FICO score?

Question

My wife is homemaker and never worked in US. She has no credit history. If I add her to one of my bank accounts and make it joint, would it establish her credit history? Would it help to grow her FICO score? Does amount of credits (loans), associated with the account affect rate of her FICO score increase?

Answer 1

Since bank accounts do not report, add her to your credit cards. Be sure that your credit cards are in good standing, no lates, low utilization, etc.

Add her as an authorized user. The lenders by law have to report the full history of the trade line on her reports.

I would never add a spouse or anyone else as a joint user on a credit card. If anything should happen, divorce, death, finances take a tumble, the AU would not be held responsible for the account but a joint user would.

An AU can be removed at any time by either the primary or by the AU, but a joint user cannot be removed.

As far as bank accounts, etc., it's always a good idea to add a spouse as a joint if you intend for the spouse to have the money, etc. should anything happen to you. That way she would not have to pay inheritance taxes on whatever you add her to.

If you plan on having the money go to other heirs, don't add her and be sure to draw up a will.

Answer 2

A joint checking or savings account won't do anything to increase the credit score to my knowledge. If you have good credit, the best way to get her credit established would probably be to cosign on a low-limit card. Or as mentioned, add her as an authorized user for your pre-existing credit cards. A lender won't have any problem with it as long as they know they can get the money from you. Use the card a least a few times a year, and pay it off every month. You might also want to check into pre-paid cards. But since these are not revoloving accounts, they might not have an impact. Oh, another thing. In order to establish credit I believe she needs to have a social security number. Anyway, call one of the credit bureaus like Equifax and they can give you all kinds of advice.

Answer 3

Yes, getting her name on some accounts should help. Add her to your oldest credit cards as well; after a few months that should give her a bit of an established credit history based on yours.

Answer 4

You can add her as an Authorized User of your credit cards; by law, the card's history must be reported in her history. Here's a site with more info about being Authorized Users(ignore the title of the article; it sounds negative but it really isn't): http://www.bankrate.com/brm/news/cc/20030312a1.asp

Bank accounts (like saving and checking) aren't reflected on a credit report, but those should be joint anyway, IMO.

Answer 5

depending on how the company structures the debt it would show up on her score. It would give her a "tradeline" (credit account) that would help her over time. It's not a bad thing at all as SOMETHING on a credit report is better than nothing! hehe, as long as you pay that bad boy on time.