bad credit reference

[dwolf]

If i were to form a partnership, with a friend who had a bad credit referance,would it also effect my credit rating,i would be most gratefulfor any advice

[WendyS]

I can't answer your immediate question but if I were in your shoes I would be extremely wary about throwing in my future with somebody who previously proved they weren't able to manage their money. This may have been for a very genuine reason like redundancy, ill health, etc. but often a bad credit rating can come about from financial imprudence, recklessness or poor self discipline when it comes to personal spending habits. Don't let your feelings of personal loyalty to a friend outweigh financial prudence. Be very sure before you go ahead with such a venture that the factors which caused the bad credit rating previously are not still lurking around in your potential partner's personality .

[Oneeyedvic]

When you enter a partnership with someone else and then apply for credit jointly an association is made.

This means than a lender, when searching either of you, will see information on both of you. This further means, that if you are applying for somehting privately, the lender will take the other person's credit into consideration.

That said, to be fair, whilst it will be taken into consideration. it shouldn't affect you too badly.

As WendyS says, be careful about going into a business with someone who does not have a good history.

[Celtigra3]

One word - DON'T!

[vicars]

Your credit rating will not be effected. Only jointly held credits will be affected. Your files will and should be separate and will remain so unless you hold a joint credit card etc. No need to worry. If in doubt phone the 2 leading credit agencies Experian and Equifax. You will not "import" someone else's bad credit rating.

[dwolf]

Thanks everyone, il steer clear of a partnership,im going to form a Ltd Company,and employ him :>)

[Oneeyedvic]

To be fair, you will still have the same problems - when applying for credit for the company, you will both be searched as director's of the company - again an association will be made.

As I said, it shouldn't make too much problems for you, but bear in mind that your finances will be linked.