How a Baby Name Can Affect Creditworthiness

Posted by Jamie Mackenzie Smith in Personal Finance on 19 August 2018

A lot of preparation (and usually arguing) goes into choosing a baby name – books, ‘top 100’ lists, place names, family names – the list of possibilities is endless. The trouble is, most parents don’t give much thought to the long-term impact of the name they decide on, beyond checking to make sure it doesn’t sound ridiculous when paired with the last name or that when put into initials it doesn’t spell something unfortunate.

For some parents, there’s a lot of pressure that goes into finding the perfect name; many want something that not only says “my child is unique” but that also tries to portray an image, personality or likeness that won’t actually come to light for some years to come.

In almost all cases though, one factor that won’t be taken into account is the child’s future Creditworthiness, which believe it or not could be affected by the name you choose for them.

Where did all these weird baby names come from?

It’s hard to know exactly where the trend started. Perhaps parents felt it would save their children money on personalised number plates because there would be less competition, or maybe people felt empowered by Frank Zappa’s kids: Moon Unit and Dweezil. But with names like “Npeter”, Figgy and Mao (in reference to the beloved Chairman) appearing on last year’s top baby name lists, it seems like the trend for ‘something different’ is only getting more widespread.

But where are they now? Dweezil is a musician, like his father before him and Moon Unit is an actor, but prefers to simply go by “Moon”. On the other hand, David Bowie’s son Zowie Bowie opted to change his name to the more sober-sounding Duncan Jones before becoming a successful film director (and by strange coincidence, making his name with a film also called “Moon”). In doing so, he swapped his rare (it’s probably safe to say one-of-a-kind) name to one shared by around 60 other people in the UK according to gbgplc.com

The benefits of having an unusual name

Put simply, the more obscure your name, the less likely your credit history is to be confused with someone else’s. That’s not to say because your parents were either lazy or ironic and called you “John Smith” that your Credit Report is going to get mixed up with any of the other several hundred thousand John Smiths out there. However, there are rare cases of someone getting a completely different person’s information on their Credit Report just because you share a common name.

If instead of being called John, your name was “SpaghettiCat McBingo”, the chances of getting confused with someone else’s information would be practically non-existent.

The downside of an unusual name

Consider the plight of Npeter. People will spend most of his life thinking his name is Peter, as the ‘N’ is silent (and so presumably stands for Ninja) and when they see it written down, they’ll probably mistake it for a typo. The same applies for Debonaire: it’s probably safe to assume it comes from the word Debonair, occasionally spelt Debonnaire, but rarely with one ‘n’ and an ‘e’ together.

With a name that’s so open to interpretation, you’re likely to get a lot of different opinions on how to spell it when it comes to people recording the name either on the other end of the phone or even just when they see it written down; lenders and Credit Reference Agencies alike are just as prone to making typos as the rest of us, so you’re likely to get a lot of aliases on your report.

At worst, lenders might struggle to find a Credit Report if they’re searching for the spelling under the wrong name, or if most of the information on your account is in several variations, which could make it more difficult (if not impossible) to apply for credit.

Lenders and Credit Reference Agencies alike have planned for this kind of issue, and use a process known as Fuzzy Matching to assess whether the information you’ve provided and the information they can see are close enough for them to assume it is relates to the same person. That means if you’ve told them your name is Npeter and a previous lender has recorded your name as Peter, they’ll most likely be able to surmise that the two are one and the same.

Keeping it in the family

For some families choosing a baby name is as simple as naming their new-born after a parent, which is a time-honoured tradition that’s also a sure-fire way to confuse lenders. This is where fuzzy matching can come as a disadvantage – where two people live at the same address and share the exact same name (father and son for example) there’s a slim chance that Credit Report information can become mixed up.

In most cases, that can only happen where there is further similarity in another identifier such as the Date of Birth. Whilst the year will of course always be different, it’s not impossible for parents and children to share a birthday, or a close variation of it (30/6/61 vs 30/6/81 for example). In these cases, the chances of Credit Reports becoming entwined increases significantly. Should this happen, the individual accounts will need to be disentangled and a Notice of Disassociation lodged with the Credit Reference Agencies in an attempt to stop it happening again in the future.

The main issue here is that whilst the parent may have left their reckless days behind them when it comes to money, their namesake is statistically likely to be less responsible, and so could harm the former’s own credit rating.

Twins/Triplets

The same applies for twins and triplets, who in addition to sharing an exact date of birth and address are often given similar forenames by parents, adding another element to get confused by Credit Reference Agencies.

If your twins are Shaun and Steven or Ashley and Alison, the ensuing matching first initial can be the final straw and see their Credit Reports (once they hit 18) become merged. Again, as well as each sibling being able to see what credit accounts the other holds, unless steps are taken to separate the information, they are likely to affect each other’s credit rating.

Choosing a name to specifically for Credit reasons

Incredibly rare though it is, there are instances of someone else’s credit information ending up on your report. For that reason, it makes sense to check some of the least popular but easiest to spell names of that year to further reduce the chances of someone else’s offspring sharing the same name or similar date of birth to your child.

For inspiration, here are some of the least popular baby names of 2017 & 2018:

For Boys:

  • Henderson (Mr Henderson to his friends)
  • Ajax (like the Dutch football team, popular cleaning product or surface-to-air missile)
  • Marvellous (who will inevitably grow up to be anything but)

For Girls:

  • Mika (like the Lebanese musician, or Finnish former Formula 1 driver)
  • Oracle (like her out of The Matrix)
  • Noam (for fans of popular philosophers everywhere)

Choosing any of these names could help secure your child a worry-free foray into the world of credit (provided they keep up with minimum payments, register on the Electoral Roll and maintain a good credit utilisation ratio).

The future creditworthiness of their bundle of joy certainly isn’t top of most parents list when it comes to choosing a name, but it at least deserves consideration.

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