Separating credit card accounts in an amicable separation?
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marmoset (
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February 9th, 2022
from iPhone
If two people are separating their finances amicably (each wanting the best outcome for the other), and they have no debt on any card, and they each have superb credit scores –
How should they separate their existing credit cards, with the specific goal of keeping both people’s credit scores as high as possible?
There are a few credit cards; in each case, person A is the main user and person B has been an authorized user for years. B has no other credit cards just in their name. This is in the US.
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6 Answers
Pay off all of them and close them. Now each person can get their own. Not messy.
To clarify, there’s no debt and the question is about how to ideally protect both people’s credit ratings (canceling all cards would be the worst approach because length of credit lines is an important part of credit rating)
@marmoset, yes, my understanding is that to close an account puts a bad mark on your record.
Would it make sense for A to just keep the accounts and B to stop using them and apply for their own account at their bank? After a time, A could just quietly delete the authorization for B. Does that make sense? B has to start from scratch anyway if they have never had their own account, right? Does B even have a credit rating?
When we separated, we ended up keeping our credit cards together for a period of time and negotiated how much each could charge. That is very amiable so you may not want to do it. I also started to get credit cards in my own name and paid them off monthly to build up my own credit score. (I do think some of our joint cards might have been in my name already.) It never was a big issue but of course, sooner rather than later, you want to have separate cards. It was quite a while ago, but I think I just stopped using “A’s” cards after a time and only used the new ones I have signed up for. The credit rating was never an issue.
If it is a separation that is aiming towards divorce then pay them off and close the joint accounts.
Get new cards in your own names. Closing an Account is not necessarily a negative reflection on your score. However your score will change if your oldest credit card time has changed, so it is inevitable it will take a small hit.
I also suggest pulling your credit reports. You can do this for free once a year with the 3 major agencies. Know what is on the books for your name as a baseline.
Don’t forget about car loans or mortgages that are in joint names.
Good luck through this challenging time.
Honestly, pay off all the cards completely then cancel them and open up new accounts/new cards in your name only. As long as the card is paid off, it will not harm your credit score.
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