The Best Way to Boost Spouse Credit Score

[armeliusc]

Hello,
DW and I are doing our annual review of our financial situation and a part of it is getting the annual free credit report. It turns out that we are having some trouble getting DW's credit report from Transunion from annualcreditreport.com (got "Unable To Complete Request" error and a suggestion to do it by phone/mail). This was the case also when we tried to do it last year and we requested the report by mail (but didn't think anything further then).

Hoping for some more insight, DW tried to sign up CreditKarma since I've been using it for a while following some suggestions in this forum. CreditKarma also cannot display her report nor score saying that she has "Thin File". This makes me goes .. hmmm.

The fact is DW just moved to the country for a few years, and she hasn't really had any reason to get her own credit. She's an "authorized user" on all my credit cards, and joint-account holder for all of our bank accounts (we have several in Ally & local credit union). But I guess that's not enough to establish credit history for her. I on the other hand have pretty good score (above 780 on CreditKarma score). So I think it'd be good for her to establish credit history / score for future needs (e.g. mortgage, etc)

So my question is: what would be the best way to boost DW credit history / score ?
I am thinking:
1. Add her as joint-account holder in our current CC
2. Get another CC with DW as the 'primary' owner and myself as co-signer
3. There's a possibility that we'd need another car sometime this year for DW actually, and if so, she can be the primary applicant for the loan with me co-signing (so that we get the best rate).

Any other suggestions ? (1) and (2) we can do in short time frame while (3) may not happen for a while.
Thank you very much and I appreciate the responses.

[CaliJim]

I'm not a big fan of micro-managing credit scores. Saving and having a big net worth is more important. That said - it is easier to navigate life - things like getting a new cell phone, renting an apartment - if one has a decent credit report.

I'm no expert - but I would think that having a credit card in her name, and having her use it regularly, and keeping the balance paid down to < $100 a month, every month, would help a lot with her score. Buy necessities....groceries, gas, etc, with it. And my limited understanding is that having a couple of revolving credit accounts is better than having one in terms of boosting the score. Just keep the accounts paid off monthly and avoid interest and finance charges!!!!

And as a father of a daughter, I think it is a good idea for every woman to have some financial knowledge, some financial sophistication, a good financial credit score, and some financial independence. It will help her frame of mind, and hopefully, she'll never have to use her financial power in a crisis.

[dratkinson]

It's easy to start here. Help her apply for a small bank loan. Cosign if you must. Then repay it on time.

Did this for my gf in the '70s. She borrowed $500 from her bank and kept it in her savings account until time to repay. It may have cost her 6-months interest (loan) to do this (~$25 @ 10%).



Could use above credit history to maybe get her own CC. (Don't know how her lack of income history will affect this.)

[JStephens]

I'd try to get a card through one of the credit unions you bank with. It probably won't be a huge limit or have cash back, but once you have a card things will snowball quickly.

[Phineas J. Whoopee]

Hi armeliusc,

One option is a secured credit card, in which you deposit some amount into an account at the issuing institution, and they provide a card with that amount as the credit limit. Yes, it does seem silly to borrow one's own money, but the situation you describe is precisely what secured credit cards are for. In today's interest rate environment earning little to nothing while paying no interest (because of course the entire balance will be paid in full each month) isn't much of a burden, and the payments are reported to credit bureaus. Typically after a year the institution will be willing to convert it to an unsecured card, and she's off to the races.

There are many issuers of secured credit cards. I happen to know NASA Federal Credit Union, which one can join for free by also becoming a member of the American Consumer Council (no dues charged) does so. According to their website the minimum required for a no-annual-fee secured card is $500. I have no interest in nor stand to profit from anybody joining; I'm just listing a possibility I'm aware of.

https://www.nasafcu.com/credit-cards/

PJW

[PreemieNurse]

Being on your bank accounts isn't going to do anything for her credit. She needs to get some lines of credit in her own name. I'd start with a credit union credit card and see if she gets approved. If she doesn't, then try a secured credit card. She can also do a secured loan against a savings account or CD, and adding her as a co-borrower on the new car loan would be a great start. For the credit cards, make sure she actually uses it every month so they can see a pattern of purchasing and repaying that will get reported monthly. She could set it up to autopay for a fixed monthly bill, or pay for groceries or gas.