Why you need to put finance before romance and do a credit check on your partner.
Many divorces could be avoided if couples did a credit check on their partner before they tied the knot or moved in together, says a leading Australian Consumer and Financial law firm.
One of the root causes of marriage breakdowns is financial incompatibility, says family lawyer Patrick Earl, who boldly proclaims that if couples compared credit ratings rather than star signs, the divorce rate would halve.
“If a miser marries a shopaholic then I am pretty sure they are going to end up seeing a lawyer like me. People don’t realise once you’re married you’re stuck with the financial decisions your partner makes, so you both need to be on the same page. Just as you get to split the assets when you get divorced you get to split the debts as well,” said Mr Earl.
“Marriage is like a business and you’re both in the business together.
“I’ve had clients getting divorced who have tried to argue that they should not be liable for their partner’s financial decisions, but often they are.
“This is how much things can come down to money: I had one client who even argued his wife had devalued herself by ‘letting herself go’ by putting on weight, and therefore she deserved less of the financial settlement.
“The clause in your marriage vows for better or worse, rich or poorer, is talking about your partner’s financial indiscretions.”
While laying bare your financial situation is hardly the most romantic thing to do when getting to know a new partner, MyCRA Lawyers chief Graham Doessel says your credit file is a window to the soul because you can’t hide your financial misdeeds.
“Because credit reporting has changed, now if you are 14 days late paying a bill it goes on your credit file. RHI or Repayment History Information means any creditor can report to a credit reporting body that you have missed a payment by just 14 days,” he said.
“Get just one of these and a happy couple will soon find they can’t take that next step of buying a house or car on finance.
“We hear all the stories of how partners hide their spending habits from partners, from the old buying gift cards to other stores and hiding it the grocery bill, to buying something expensive and returning it for something cheaper and spending the difference on themselves.
“In some cases, one partner is even hiding their tardy bill paying from the other and often it ruins both individuals’ credit rating because these late payments are now recorded.
“We have even seen spouses doctor up fake bills and have secret bank accounts.”
Were you aware that financial stress is one of biggest precursors to divorce? Has money ever caused you and your partner problems? Do you know your partner’s credit rating?
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