Credit Score Basics > Does opening a joint account affect your credit score?

Does opening a joint account affect your credit score?

Wollit Team2 minute read · Updated 29th June 2024

Opening a joint account in the UK can have a significant impact on your credit score.

When you open a joint account with someone, you become financially linked to that person, which means that lenders will look at both of your credit histories during credit checks.

What is a joint account?

A joint account is a bank account that is shared by two or more people. Both of you will have equal access to the account and will be equally responsible for any debts or overdrafts incurred.

How can a joint account affect my credit score?

When you open a joint account, you become financially linked to the other account holder. This means that companies will look at both of your credit histories when they run a credit check. If one of you has a poor credit history, it could potentially lower the loan approval chances for both of you.

On top of this, both of you will be equally liable for any debts or overdrafts incurred.

So if one account holder fails to pay back an overdraft bill, for example, this will show up as a missed payment on both credit reports – and lower both credit scores.

Also, a joint account will stay on your credit report for as long as the account is open and active. Once the account is closed, it will still be visible on your credit report for six years.

How can I protect my credit score when dealing with a joint account?

The best thing you can do is select your joint account holder very carefully. Try to only open a joint account with someone with a credit score similar to yours or better, of course. More importantly, make sure that they’re reliable and financially stable.

The next best thing you can do is close the joint account and remove the financial link as soon as it becomes obvious that it’s affecting you negatively.

The way you do this is by requesting a “Notice of Disassociation” with the credit reference agencies.

One thing to keep in mind: if you have a joint account with your spouse but want to protect yourself from being financially linked, you don’t need to divorce to do it. Requesting a Notice of Disassociation only needs you to close the joint account.

You can still be happily married yet keep your credit scores separate.

Could a joint account improve my credit score?

Yes, a joint account could improve your credit score if it is managed responsibly by both account holders. It’s no different than from any other credit account: if you and the other account holder make payments on time and keep the account in good standing, it will eventually improve your credit score.

However, simply opening a joint account with someone with a better credit score won’t magically improve yours. In fact, it might even reduce their future loan approval chances as they’ll become financially linked to you.

Luckily, now there are many apps that can help you build and improve credit.

One such app is Wollit. Wollit works by reporting a fixed-fee monthly subscription as a loan repayment to all three credit reference agencies.

This helps you build your credit history and gives you a chance to improve your own credit score without having to piggyback on someone else’s credit rating. Plus, as your credit score improves, you’ll be able to open a joint account with your partner or anyone else without being concerned that you’ll affect their credit score, either.