A few years ago I got a credit monitoring app and started watching my credit score (high 700's). It's been climbing slowly and sends me an alert when I apply for new credit - like when I bought a car or applied for a Lowes card.

Today I set my wife up with the same app. Her credit score is moderately lower than mine (low 700s). We discussed the details to try and find out why and I found out that she had cosigned with her parents on credit cards that have been maxed out, totaling low five figures. I didn't pitch a fit at the time. The total debt is a major inconvenience but it's not "We can't pay that off in our lifetime" money.

As I drove to work, I realized that like roaches, there may be more issues at hand. I knew that my in-laws are not financially sound but didn't realize the magnitude. I'm not trying to be judgmental - the recession hit them hard - but it is what it is.

Unfortunately, in addition to those cards, my wife's car is also titled to both her and her parents and more importantly, our bank account also has her mom's name on it*. Can those assets be seized in whole or in part in any unfortunate events?

Finally -- my credit score seems healthy with no mention of those cards but my wife and I are married. Are there any active steps I need to take to prevent my credit from sinking?

TL;DR -- My wife is on the hook for credit card debt and the car and bank account are shared with holders of bad credit. Can those real assets be seized? Since we are married, what do I need to do to wall off my credit score from that issue?

*I lost the fight on whose bank to go with when we got married and we just left the MIL on the account. My wife was a preteen when they opened the account so they put both her and her mom on it. My MIL doesn't have a debit card or checks so she'd have to go to the bank personally to make a withdrawal.

  • 44
    So your MIL can spend your money at will? That's wild. Are you in the US or another country? – Hart CO Sep 13 at 14:40
  • 37
    I would not worry about your credit score currently. You have assets that are exposed. Most important things first. i.e. Fix the bank issue. Actually, thinking about it, time for some conflict resolution as a talk with your wife about family, finances are in order. Best of luck. – paulj Sep 13 at 14:44
  • 45
    Opening bank accounts is super easy. You can have a bunch of them. You can have your own account. Your wife can have her own account. You can have a joint account between you and your wife. And you can have a three-way joint account between you, your wife, and your MIL. All at the same time! You can transfer money between them within seconds, with your phone. You can even schedule transfers so you don't even have to do anything. You can set all of this up in a day! If you think the fight for whose bank account to use was bad, think about the fight when money goes missing from the big pile. – Clay07g Sep 13 at 18:19
  • 9
    A state tag would help. Stuff like whether it's a community property state would likely be relevant. – Acccumulation Sep 13 at 20:50
  • 16
    The MIL's name should have come off the daughter's account shortly after the daughter turned 18. – Mark Sep 14 at 1:22

Is your name on your account at all? If yes, you go to the bank tomorrow morning, open an account in your name, and move all the money over. Then tell your company to change their payments to the new account. After that, you explain to your wife. This is madness. (I’d recommend the same to your wife if a member of your family was on that account).

If your mother in law gets into trouble and bailiffs want money, they will go straight to the bank account with your money. If she dies and leaves everything to charity, they will go straight to your account.

If your name isn’t on it, talk to your wife because then she needs to take action.

  • 33
    A thousand yesses - my bank transferred out 5k from my savings account for a debt my father owed them. I hadn't realized he was still on the account from when he opened it for me when I was born. – dsolimano Sep 13 at 16:30
  • And yet (if he's in one of many states in the US), he can still be responsible for any debts his wife incurs and is unable to pay. The good news in this scenario is that once he cuts his wife and her family off, she'll hate him, and divorce (with a good lawyer) will come to the rescue. – horse hair Sep 13 at 19:53
  • 1
    "If she dies and leaves everything to charity, they will go straight to your account." No, if she dies, the bank account will not become part of the estate. – Dietrich Epp Sep 13 at 20:54
  • 10
    "if she dies and leaves everything to charity", IANAL, but I'm pretty sure creditors get paid off before assets are distributed. If that wasn't so, then any will that said "I leave everything to my son" would leave all the creditors high and dry. – Jay Sep 13 at 21:14
  • 11
    Making such a move without telling the wife first is a recipe for divorce. Then again, if you have to do it without telling the wife first, divorce may be inevitable. – Robert Harvey Sep 15 at 16:53

Can those assets in whole or in part be seized in any unfortunate events?

If the vehicle is used by your wife primarily, then it is likely not at risk. The bank account is, the extent to which you are exposed depends on the state. In some states joint assets are considered equally owned while in others the ownership would be assessed based on contribution (in the context of bankruptcy). The greater risk is that they have access to your account, maybe they'd never use your funds, but who wants to find out?

Finally -- my credit score seems healthy with no mention of those cards, but my wife and I are married -- are there any active steps I need to take to prevent my credit from sinking?

Your wife's credit score will not affect yours, but if you ever apply for a loan together her score can hurt you. As a co-signer, she is on the hook for any unpaid bills, that is much more likely to hurt you than her credit score.

  • 21
    @anonibon I'd be more worried about you MIL collecting on the bank account. Technology has made it possible to easily transfer money between accounts at any time within seconds. There's literally no reason to share a primary account with another human anymore. If you absolutely need a three-way joint account, make one and transfer money to it regularly from your primary account. You can even set up automatic scheduling! – Clay07g Sep 13 at 18:09
  • 11
    @AndrewLazarus No, I didn't. Seriously, there is absolutely no reason to share a primary account. It's great to have joint accounts with your spouse, children, even your adult children if the situation warrants. They just really shouldn't be anyone's primary account (except the child's, if they couldn't get an account otherwise). Sharing a primary account is like giving someone a stack of 100 separate $1 bills and instructing them to only spend $1. Why not just give them $1 and keep the rest in your pocket?? – Clay07g Sep 13 at 23:31
  • 6
    Given that I live in a community property state, there is no point to separating out mine and my wife's wages, and we don't have to argue whose turn it is to pay the electric bill. For our cash management accounts (stocks plus checkwriting and debit card) it would be a nightmare. Buy 50 shares of XYZ each? We also have separate accounts, consisting of inherited money, which is not community property. – Andrew Lazarus Sep 14 at 6:08
  • 11
    @Clay07g, nelson I have to disagree with you. I see absolutely no reason for my wife and I to have separate accounts no matter how easy it is to transfer money between them. Separate accounts indicates my money and her money which is something I simply don't believe in. It's all our money. We pay our bills with our money. We make decisions on what to spend it on together. There is no my money and her money anymore. This was true when got married and were both working. It is still true now that she's staying home with our son and I'm the only one working. – Evan Steinbrenner Sep 14 at 20:28
  • 6
    @Nelson "How do you even figure out who's money is who's?" For spouses, you don't. In many states there's no such thing as the money belonging to one of you or the other. If either of your names is on the account, the money legally belongs to both of you. And many couples who don't live in such states choose to operate their finances that way because it leads to a happier marriage when you treat property as "ours" rather than "mine or theirs." – reirab Sep 14 at 20:41

You ask a good question, but I think you are sadly mistaken in some of your views on personal finance. The first is a that a good credit score for you has much value. It has some, but credit score does not indicate wealth. The second misconception is that you are somewhat insulated from your wife's financial condition. You aren't and the bad things that are looming will happen to you as well.

The first thing, obviously, would be to have your MIL removed from your wife's bank account. The bank account should be for you and her both, and no one else. My wife and I have different bank accounts, however, we are both signers on each others. It is, really preferable that you two have one account so you can learn to work together on personal finance.

Secondly the credit cards in question need to be closed. MIL and FIL will have to fend for themselves with the revolving credit. However you two will have to pay these bills off yourselves. They don't have any money, and if they did they would manage it poorly anyway. It sucks but better to deal with it now then when the balances grow even larger.

Sure you can probably maintain your credit, and that bank account will not likely be seized, but that is not really the point. This mess needs to be cleaned up and you really do not want your financial future tied to these people.

  • 6
    I have to disagree with your first point. A good credit score is important and can really affect the amount you pay on your major purchases. Do you need to worry about every last point once you get into the high 700s? Maybe not, but it is something you need to be mindful of. – JPhi1618 Sep 13 at 20:09
  • 1
    Before taking the MIL/FIL off the credit card, see if the OP can take the wife's name off the card. That fixes things much faster, without literally taking on her parents debt. If the CC won't take off the wife's name, they probably won't take off the parent(s) either, so that's a no-win there. – computercarguy Sep 13 at 20:55
  • 4
    @JPhi1618 Pete B says your credit score does not matter because he is a strong believer in paying cash for everything. – Eric Sep 13 at 21:59
  • 2
    If the parents are maxed-out but not actually delinquent is there actually anything the co-signer can do to end the arrangement? – Peter Green Sep 14 at 13:20
  • I tend to agree with Pete B. I have been without debt long enough that I have no credit score, and it has never stopped me from buying anything I needed. A bonus is that timeshare salesmen don't bother me any more. – pojo-guy Sep 15 at 17:27

You have a mix of family and financial problems here. What's smart to do financially may cause conflict in the family, and you have to consider that.

First question to me is why you set up these accounts like this. If your in-laws have bad credit and can't get a credit card without your wife cosigning it or some such, then getting out of this situation will put your in-laws in trouble, and thus presumably cause family problems. If it was just a matter of "oh, seemed like a good idea at the time", then much easier.

As others have said, this is a very dangerous situation. You're essentially giving your in-laws the legal right to spend unlimited amounts of your money and to run up debts for which you are liable. Even assuming that they do not deliberately take advantage of you, if they are irresponsible or careless they could cause you major problems.

Easy step 1: Stop using the bank account that your wife shares with your in-laws. Open a new account and put your money there -- that is, the money that belong to you and your wife as opposed to money that belongs to your in-laws -- not in the joint account. Withdraw your share of the money from the joint account and put it in the new account.

Step 2: As long as you don't deposit to the joint account, you reduce your risk, but you don't eliminate it. If your in-laws overdraw the account, as long as your wife's name is on it, you're still liable. So get your wife's name off the account, or close it. I've never tried to take one name off an account, frankly I'm not sure how that works with the bank. I don't see why they wouldn't agree to remove your name from an account that has money in it -- you're giving up an asset. That's not at all the same as saying "take this other person's name off this account". That would have the obvious potential to be trying to steal someone else's share of the money.

Step 3: You need to close the credit card account. I'd tell the in-laws that this account is hurting your credit rating and you need to close it. They are certainly free to open up a new account on their own, you couldn't stop them from doing that if you wanted to. If they don't accept that, there could be a family fight, but I think you have to bite the bullet and do it. When you close a credit card where you still owe money, of course you still have to pay off the existing balance, but the bank will de-activate the card so no new purchases can be put on it. Once you pay it off, the account will completely close.

Of course all this depends on your wife agreeing to go along with these steps. If she says "no, I want to keep these accounts" for some reason, you have a family problem. How you deal with that is an entirely different kind of question. Whether by threatening to break china as gnasher729 suggests, going to a marriage counselor, murdering her and disposing of the body, or what. It may not be possible to separate your finances from your wife's. In community property states, the law explicitly says that all property is owned jointly. I'm not sure how it would work in other US states and other countries.

  • "Withdraw your share of the money from the joint account and put it in the new account." Suggest rephrasing this. As noted in comments on some other answers, viewing money as belonging to one or the other can cause conflict in marriage (and similarly, viewing everything as belonging to both reduces it). In 3, I'd also emphasize that it's hurting their daughter, rather than the OP. ...And the murder bit is not really funny. =/ Otherwise +1. – jpmc26 Sep 15 at 1:17
  • I don't think there's a way to get someone's name off an account, I had cause to try with a co-signed bank account but was told the bank's official method was to open a new account and close the old, instead of modifying the account holders. Might be different in different banks, different areas but might not be. – Megha Sep 15 at 2:29
  • 1
    @jpmc26 The answer is referring the couple's share versus the parent's share. – The Great Duck Sep 15 at 4:51
  • 1
    @Megha Possibly so, I've never tried to take a name off an account. When my wife left me, we divided what was in the joint account and closed it. I opened a new account in my name only. (She already had accounts in her name only that she'd never told me about and where she was hiding money from me and the divorce court, but that's another story). – Jay Sep 15 at 5:36
  • 1
    @jpmc26 "viewing money as belonging to one or the other can cause conflict in marriage" Maybe so and I don't suggest doing that. But for those posters who do make such a suggestion, I don't think you can just make a blanket statement "don't do it, it causes conflict". You'd have to discuss pros and cons. – Jay Sep 15 at 5:45

From my experience, this is an emergency. Sorry to say. I think you know the first problem you must work on is interpersonal, not financial.

Why is it an emergency?

  • your wife didn't tell you about this situation before your wedding.
  • her bank account belongs to her mother.
  • the credit cards with high balances on them are a bright red flag.
  • you've said confronting your wife with this situation will damage your relationship. Ask yourself whether she has, by keeping secrets, damaged your relationship.

If I were you (I've been you, when my spouse and our adult child had shared credit cards) I'd deal with this right away.

What if somebody in your wife's parents' household has, or gets, gambling or drug problems? Rationality and fairness will not be factors in that case.

First, I'd find a competent marriage counselor to help you strategize this, and to be on-call if it causes a huge blowup in your marriage.

Second, I would ask my wife to kill the credit cards to which her parents are making charges. By "kill" I mean tell the card companies to disallow future charges. Your wife can get a new credit card in her sole name. She should do it immediately, without giving you excuses, because of the accrued debt. If she doesn't, that's why you have the marriage counselor. You need to be polite but unbending about this.

You can start the conversation by saying, "when I found out your parents ran up a lot of debt on your credit cards, I honestly felt betrayed and frightened. We need to be in this together. Please, let's work together to sort this out. I think the first step is ... What do you think?"

The formula:

  • describe the bad behavior
  • explain its emotional effect on you
  • ask for a realistic change
  • offer to help.

Third, once the second step is done, I'd ask her to open a bank account in her own name and move the balance of the joint account to the new account. And, if your wife's employer direct-deposits her pay, move that to the new account.

Fourth, I would ask your wife "is there anything else?"

Fifth, I would have a conversation with her about how your household can support her parents' household. Do they need money? If so you can figure out how to give them some, perhaps by making a regular deposit to the joint account.

Sixth, you and your wife should be on the same page, or close to it by now. Have a conversation with her parents about money and so forth. Keep in mind that the conversation will really be about your mother-in-law losing her baby girl.

Good luck and courage to you.

A few things I would add that have not been mentioned in other answers:

1) You should determine whether you live in a common law property state or not as this can significantly change how much liability you are incurring from her financial entanglements.

2) Regardless of if you live in a common law property state or not, her credit score is not a huge issue in most cases if you are okay not including her on titles. For instance, when I bought my house, my wife did not have much credit. We actually had to take her off the mortgage paperwork to get the loan approved, even though I live in a community law property state (see previous link) so she was just as much an owner as I was, regardless of what the mortgage or title says.

3) Especially if you live in a community law property state, and you are worried, you may want to approach your wife about drafting paperwork where she willingly signs over big ticket items to you, or to a trust you setup that she is not part of (except in the event of your death). This will give you a fighting chance if it ever becomes an issue, and will certainly complicate the process of a third-party taking your property. Of course, this requires significant, mutual trust.

4) Repeating a bit of what others have said, you should create your own bank account, and your wife should create her own bank account without her parents on it. This at least will require much more court involvement for a third-party to access the money. If the parents' names are on the account or on the car, they are fair game for reprisal on loan default. Get the car transferred to your wife or even better, to you, as soon as possible.

  • I think you mean a "community property state", not "common law property state". (Unless there's another type of law that I'm not familiar with.) – Jay Sep 13 at 21:17
  • @Jay Click the link, there are explanations of both – JollyJoker Sep 14 at 10:59
  • 1
    You should write a stand-alone answer. As a reader I have no idea what you mean by "the previous comments" because answers are not sorted chronologically, and can be edited at any time. – pipe Sep 14 at 16:01
  • 2
    I think this answer has common law property vs. community property laws reversed. It's community property states where both of you own it if one your names is on the title. According to the provided link, common law property laws say the opposite: "The common law system provides that property acquired by one member of a married couple is owned completely and solely by that person." – reirab Sep 14 at 20:50
  • 1
    @reirab You were correct, I've updated the answer. – shellster Sep 17 at 18:26

protected by Community Sep 15 at 15:21

Thank you for your interest in this question. Because it has attracted low-quality or spam answers that had to be removed, posting an answer now requires 10 reputation on this site (the association bonus does not count).

Would you like to answer one of these unanswered questions instead?

Not the answer you're looking for? Browse other questions tagged or ask your own question.