Credit card debt is a revolving loan that you continuously borrow each month. You can continue borrowing as long as your repayments are sufficient enough that the amount owed does not exceed the set limit. Once you have set up a credit card account, it is never closed when you are done with repayments but can be used for an unforeseeable future.
This debt is usually unsecured. This means that it is not guaranteed by any property you own that can be seized in case of default. Though it is not backed up by any security, they can still affect your credit score and worthiness the moment you stop making repayments.
Credit card debt can plague your life, especially if you lack discipline when making purchases with it. You can find yourself having financial problems even when you get married if you did not manage your card debt.
How does credit card debt accrue?
You accumulate credit card debt if you cannot pay the owed balance at the end of each month when the repayment date falls due. Remember these loans are charged interest rates in the form of APRs (annual percentage rate). Usually the interest rates vary greatly depending on card issuer and the type of card.
You are charged interest the moment you pay less than the amount owed. The less you are paying, the more interest you accrue. You will not want to have problems in your married life because of a credit card debt, but if you are in a bad situation due to poor credit score as a result of debt mismanagement, do not worry because you can work on restoring the score. You can find out more on how you can work with credit repair experts to boost your rating.
Can you be held liable for your spouse’s credit card debt incurred before marriage?
Any debt you incur before you get married is still and individual obligation. After marriage, you can share responsibilities for any borrowings you make together. Remember that credit card debt does reflect on your credit report. This means that if your repayment history is not good, your credit score is affected. If you want to borrow jointly as a couple, both of your credit reports will be reviewed, and if one or both are not good, this seriously limits your chances of getting a credit facility.
How will you deal with your spouse’s credit card debt?
It is important to first clear away all of your credit card debts before you get married. This way, you get into marriage with a better credit score, meaning that getting credit for personal development is easier.
You can still find yourself in the situation of getting married to a spouse with credit card debt. You can take care of the situation by applying for a low-interest credit card and then transfer the spouse’s debts to that new card. You will then work together towards repaying the entire amount owed.
Some words of advice
It is important to acquaint yourself with your future spouse’s financial outlook before you get married. This can help you navigate away from financial problems when you are getting into a marriage. You need to know your partner’s spending habits, credit history debts, and even assets. You will then know how to manage the debts owed if any.