Five Tips to Help You Through a Joint Credit Application

credit cards for couples

Applying for joint credit — whether it’s in the form of a credit card, mortgage, or personal loan — can be a great way to boost credit limits, lower interest rates, and help the credit score of a spouse or loved on who co-signs the application with you. But this process is not as easy as some might think, and there are some important considerations to make both before and during the application period. These tips will save you time and anxiety as you pursue your joint credit application and ensure you get the best deal possible at the conclusion of your search.credit cards for couples

Review Each Individual’s Credit Report

There’s absolutely no need to go into a joint credit application process without knowing both individuals’ credit scores. That’s because credit reports are generally available online without much of a hassle — simply provide your personal information and review the credit score that follows. You’ll need this information to help you decide which person will be the primary applicant. As most people know, higher credit scores lead to higher credit limits, better interest rates, and a greater likelihood of approval when submitting the application to a credit card company or lender.

Discuss Income Levels and Personal Debts

In the case of a credit card, a simple credit score might be enough for the credit card issuer to make a sound decision and reward the card to the person with the highest score. That person is also likely to receive the best terms on the credit card. However, there is something to consider if your joint application is for a loan or a mortgage: many lenders will pay less attention to the actual credit score and more attention to the highest income. That means the person with the lower credit score, with the higher income, may be the primary applicant. They may even have a better chance at approval.

Lenders who issue personal loans and mortgages are more interested in the income-to-debt ratio than simple credit scores. And while a high credit score certainly can’t hurt individuals on a joint credit application, it’s worth knowing exactly who is best-qualified for the specific financial product you’re applying for. And sometimes, that goes deeper than a simple three-digit credit rating.

Select a Credit Card Issuer or Lending Institution

Once you’ve fully fleshed out each individual’s creditworthiness and financial details, it’s time to compare. There are numerous comparison sites out there (like Credit Card Compare for Aussies) that are dedicated to helping you get a better deal on the credit that your looking for. This is perhaps the most essential part of the process, as it helps to determine where the best limits and rates will come from. Different financial companies will offer different rewards and bonuses to their applicants — some will be credit-based, but not all of them.

Credit card applicants should look for things like “cash back” bonus programs or cards that earn points toward rewards and future discounts. This is a great way of making your money — and your credit — work for you, rather than against you. Of course, credit card applicants and joint loan or mortgage applications will both want to look for the best interest rates, fee schedules, and limits on their borrowing. This can be an extensive proess, but it’s necessary for a sound financial future in the long-term.

Avoid Big Purchases Before Applying

This especially applies to mortgage applicants, but it’s helpful across the board to any joint credit applicants: don’t go on a shopping spree in the lead-up to your application. You don’t want to look financially unstable, or like a spendthrift, in the eyes of someone who is assessing your financial risk to their institution. Keep your debt loads light and your bank account fat.

Send the Application Digitally

Using an online application is a much better way of applying for joint credit instruments like credit cards and personal loans, as a decision can be reached in minutes or hours instead of days. And, for what it’s worth, you’ll save on postage. An instant decision helps you better know whether to continue applying elsewhere or whether your search is over. And it’s always better to know that sooner, rather than later.

Final Thoughts

Applying for joint credit shouldn’t be too difficult when all of the right steps and precautions have been taken. Know what you’re working with — credit scores, financials, and other information — and know where the best deal is.

Matt Polo is a writer for The Credit Letter, an Australian finance blog. He also write reviews on balance transfer credit cards.

Photo Credit: Robert Scoble

Clark Howard’s Living Large in Lean Times

Living Large in Lean Times Clark Howard review

This week’s book review is for Living Large in Lean Times from Clark Howard. After receiving a review copy I went ahead and read the book over the last few days. There’s a ton of information, so I finished it fairly quickly. I’ll highlight some points to help you decide if this is a great book for you.Living Large in Lean Times Clark Howard review

Basic Book Info

  • Full Title: Living Large in Lean Times
  • Author: Clark Howard
  • Publisher: Avery
  • Price: $18.00

Living Large in Lean Times Overview

What’s Inside

If you’re curious about what Living Large in Lean Times covers, here is the table of contents:

  • Cars
  • Computers and Internet
  • Consumer Issues
  • Education and Jobs
  • Health and Healthcare
  • Homes and Real Estate
  • Insurance
  • Personal Finance
  • Telephones and Television
  • Travel
  • Clark’s Graveyard
  • Important Websites

As you can see, Clark organizes his book according by different areas of spending. I found it perfect as a reference for those that may have a particular area in their finances that they’d like to tackle. You may want to focus on your insurance or maybe you’re looking at booking a vacation. you don’t have to read through the entire book to find what you need, you can just pick it up at that chapter.

My Highlights from the Book

While each section has some valuable tips on saving money, I was especially drawn to some areas that directly applied to us.

Cars- Repairs and Purchasing

Two big car issues on my mind are:

  1. Finding the best deal on our next car
  2. Keeping car repairs reasonably priced

In regards to finding and buying our next car, Howard offers some great tips on buying used without getting a lemon. He shows readers how to check car repair records, examine total operating costs, and how to find a hybrid that will itself back quicker. He also tackles selling your old car in a separate transaction, not trading it in at the dealership. For those interested in financing their next car, Howard has tips on getting the best deal and avoiding getting gouged at the car dealership.

Having to paid for cars means that our biggest auto expenses come from car repairs. Howard has tips on getting reimbursements by checking recall and service bulletins, finding a second opinion for your repairs, and when you really need oil changes. These tactics may seem minor, but over the life of the cars, it can save some significant amount of money.

Insurance – Find the Best Deal for Our Family

I think we do a generally good job with our day to day finances, however, I really believe my husband and I could improve our insurance policies to reflect our current situation and save some money in the process. Inertia is one factor against us, so I was happy to see Howard offered tips in this area. I was especially interested in learning more about Flexible Spending Accounts (FSA) and how we can use our pretax dollars and save money.

He also reminded me that we needed to document our belongings either with video or a site like knowyourstuff.org. He also has a guide to getting a free C.L.U.E. report to make sure insurance companies have accurate information on you and your spouse.

Thoughts on Living Large in Lean Times

I think this book is a great fit for people looking at being savvy with their finances. There’s a ton of information that you can dig through to make sure your money is going further for you. While some of Howard’s tips may seem a bit extreme, they are frugal tips that can cut your spending greatly. I wouldn’t dismiss them too quickly – talk it over and try it if possible.

I think we handle our finances pretty well, but we could do a better job. I’ll be using this book to optimize our spending and savings. Over the rest of the year, I share the results to see if we can improve our finances. It may help us reach our financial goals for this year sooner.

I’d love to hear feedback from others that have read the book. What did you think about it? What chapter was most helpful for you? What was the least helpful?