How do other people’s debts affect me?

Credit ratings loom large, especially when you’re trying to get a loan or mortgage.

So you’ve done your best to keep up to date with your credit repayments, and tried not to default in the hope that it will give you a pristine credit rating.

But we all know that credit ratings are dependant on lots of different things and being accepted for credit is never guaranteed, especially in the current economic climate.

So how does it work?

If you are trying to increase your credit score, it’s important to try and understand what can and can’t affect you. And one question we get asked time and time again is:

• How do other people’s debts affect me?

Other similar questions include:

• The previous resident of my home had debt problems, is credit rating linked to address?
• Can an address be blacklisted for credit scores that are poor?
• I live with my mum and I think she might be behind on her credit cards. I don’t want to ask her but will it affect me?
• I want my boyfriend to move in with me but I’m worried about my credit rating. Will his bad debt affect my rating?
• My parents are in an IVA. Will I be able to get a mortgage?

And there’s the flip side too. You may not want your adverse credit history affecting your nearest and dearest. So what’s the deal, can they be affected?

The simple answer to all these questions is NO.

Previously, everyone under the same roof shared a credit history. You can imagine the problems this must have caused. Unruly previous tenants affecting your ability to get a phone contract or non-dependant children racking up bad debt under your roof!

Those days are long gone, there’s no such thing as a blacklist and each file should be based on the individual alone.

Are we connected?

Provided that you’re not financially associated in any way and you’ve never had any joint accounts or debts, your credit history will be entirely separate from anyone else’s, whether you live with them or not.

If you’re unsure whether you’re connected learn more about how joint loans can affect you. Remember that acting as a guarantor can also link you financially.

If you’re worried about your credit file, remember to put things into perspective. Credit rating is not the be all and end all.

If you or others are struggling with problem debt, it’s more important that you focus on that rather than its effects on your credit rating. All things considered it’s unlikely that you’ll be in a position to borrow any more until your existing debts are cleared.

Are there credit cards for people with bad credit ratings?

Yes, there are, but it’s likely you’ll be offered a higher interest rate. The good news is that credit ratings, or scores, are updated regularly, so things can get better.

You can read more about joint debts on our website.

If you or someone you know is struggling to get access to credit there could be an underlying debt problem. Get in touch with us to see how we can help.

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• Living with debt

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