I need to obtain some advice on whether or not to add my husband's income as total available income for my current CCs and any future cards I may app for. Right now, I hold four cards, all using my name and income only. We've been together for almost 12 years and married for four, with no foreseeable risk of separation / divorce in the future.
While rules say that I can, the question is: should I? What are the advantages and what are the risks? I'm not at risk for spending beyond my means (been there and never again!), and I'm sure He has his own cards in his name, but the question was raised recently for both of us.
A larger income could warrant higher CLs with good scores and no adverse markings. Both of our names are on the mortgage and we report taxes as married filing jointly. I'm just curious as to if there's a right and wrong to it all when it comes to CCs and joint income reporting.
I welcome all feedback!
I wouldn't say it's right or wrong either way.
Adding his income as you suggested will naturally strengthen your profile, thus allowing you to grow larger total limits yourself whether that means opening up new accounts, growing existing credit lines, etc.
One negative could potentially be if requested to provide POI. You'd have to be willing to provide income documents for by you and your husband. Naturally you'd want to discuss this with him first to see if in the event this were to happen if he'd be willing to do so.
We actually discussed this topic at great length tonight and he agrees that we should be reporting ALL available income for ALL cards we hold. Our thought is: we would have to do that for any home or vehicle loan, so why would should a CC be any different?
As far as POI, that won't be an issue. That being said, I've already taken the liberty of updating my income profile with each bank. I'm looking forward to seeing some noticable improvements in CLIs and new card SLs in the future!
I'm sure you'll see some nice credit limit increases.
What I find sort of odd when considering combining incomes is that both parties are able to show a greater income and essentially double the credit limits can be achieved off of the same amount of income. What I mean is this:
Say you both have $50k in income and let's say for the sake of numbers that an individual is able to achieve 2X their income in credit lines. So in this example, each person in the couple is capable (on their own) of achieving $100k in credit lines with their own $50k income reported. Together this couple possesses combined limits of $200k.
Now, both individuals report their combined income to their creditors which is perfectly acceptable and legal as it's income that both "have reasonable access to." Now with a reported income of $100k, each of these individuals can obtain $200k in credit lines. Together this couple possesses combined limits of $400k.
I find it strange that given the same "real" income in both examples ($100k in total income exists between these two individuals) in one example 2X income can be achieved where in the other 4X income can be achieved.
Hopefully that illustration makes sense.