Does Changing Your Name Erase Your Financial Past?
Every morning we are given the opportunity to start a new life. The decisions we make from the time our eyes open until we lay down for a good night’s rest shape the paths for the next day. For those of us who legally change names, there are a set of decisions that must be made in order to continue living our financially free life. Or to improve the credit history tied to our former name.
Embracing New Possibilities
We must be very clear that changing your name does not erase your credit history including credit score and debts owed. In fact, it is considered fraud to change names with the intent of escaping financial obligations. Any person caught doing so faces repercussions including the possibility of criminal charges.
Luckily, it is quite easy to avoid problems and follow proper procedures for keeping financial institutions up to date. You can even use the establishment of new names as a way to close the door on any troubles in your credit history. Simply contact any agencies with which you may have outstanding debt to alert them you are changing names. At that point, ask to be put on a payment plan. Or ask to negotiate a smaller debt by paying immediately in full. That helps you enter the next phase of life with a positive bump in your credit score.
So What Exactly Happens To Your Credit Score?
Upon your new name being legally approved, contact all governmental agencies such as the electoral register and HM Passport Office. Also, contact all banks and financial institutions you do business with to alert them. After you update all agencies, an ‘alias’ automatically generates on your credit report. The ‘alias’ links your former name with your new name. Remember that credit scores and reports are built on data sharing. Even if you don’t indicate your former name when applying for new credit cards, etc, the lender will discover your it. Then they could decide that you were attempting to commit fraud by hiding your former name. But don’t worry! Now you know and can avoid that mistake later!
The ‘alias’ ensures all of your credit history and credit score stays with your new name. That way all of the good credit you held under your former name comes along with your new name. Please note that it can take several months for all of your accounts to update. This means that if you apply for new credit cards or loans in your new name straight away, you may be denied as not having sufficient credit history. The reason is because to the credit bureau, the new name is a new person with no history at all. The best thing to do is wait a few months after your name change and order a credit report. Confirm your names are correct on all accounts and then complete any new applications.
Don’t Let the Process Intimidate You!
To stay on the right side of legal requirements for reporting your change of name, the easiest thing to do is order a Deed Poll kit. We offer one that allows you to select all the government agencies and companies you do business with and delivers the paperwork and instructions to you.
