Loving debt but one partner wants to cut back

I just want to consolidate my unsecured card debt to use it as long as I can, then use some of the money to repay debt I used to have in a credit card last year. To me that makes sense, though my wife is a bit dubious. We have zero outstanding on our main credit card but have a retail card with over £25,000 outstanding. Is it a good idea to consolidate the unsecured debt? JS

As far as we are aware, credit history goes beyond length of time outstanding (that can be years). According to the Equifax, Your Comprehensive Credit Profile, you and your wife are both creditworthy, with the couple only accounting for about 5.5% of its clients’ individual payment rate. However, it was important to get your marriage established so that you can both pursue your individual creditworthiness. You didn’t disclose how much debt you have and if we are correct, there is plenty of time for the cost of cards, and therefore of interest, to start making their influence on your situation small – it is a slow burn.

I would hope that you can meet the criteria for your joint account but if it looks unlikely that the time will pass or if you are unable to manage the account from a timely basis, you may need to shut it and repay the £25,000. The main takeaway from the Equifax piece is that within one to four years after you open a debt account, be it credit card, mortgage or other, those with good-standing credit will see their scores going up. For more detail about credit scores, see the Equifax piece.

Those who are slow starters, or (given your already mountainous debt) feel like they haven’t established their creditworthiness, can expect a lower score, but the Equifax piece also warns that rewards cards and gold cards are no good – as long as you have any other cards active. Even if you wanted to pay all your cards off one at a time, but were unable to, you would be counted as having two accounts in your name.

This is one case where the Equifax piece’s warning doesn’t carry the most weight – you and your wife obviously have a credit history together and you don’t have to shut the shop. But I do suggest that you consider what you would do if you were to be refused any credit cards for the next two years as these could be really quite damaging.

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