Can I have a bit of advice for my sis please

jackie_w

Hi,

My sis and her hubby split up last year, they had quite a bit of debt between them, but, they came to an agreement at the time and split the debt. She kept the house, and managed to get the mortgage transferred into her name, and she was managing okay.

Her hubby is self employed, and is making noises about not beign able to meet the monthly payments, and it talking about going to speak to someone to see if he can come to some sort of arrangement with the creditors.

The debt he pays is in joint names, so what he does instead of giving my sis money for their son, he just keeps the money and pays her half of the debt, (hope im explaining this okay).

My sis says if he does this she is concerned as to how this will affect her credit rating, and if she will lose her house, (there is no equity on the house im afraid, as they were in quite a bit of debt). If he does pay his creditors a set amount every month, then my sis says he will have to give her maintenance money for their son, but, with this maintenance money she would be able to pay her half of the debts every month.

if she did this, would this affect her credit rating. She is only worrying about this because of her mortgage, and when she comes to renew her mortgage deal.

Dithering_Dad

Did they split the debt legally or was it just an agreement between your sis and her ex?

If the debt was split legally, then it shouldn't be in her name anymore so her credit rating should not be affected. If it wasn't split legally then I'd suggest she pops along to a solicitor to see how she stands.

fatbelly

This sounds like an 'informal' arrangement, so will still be subject to 'joint and several liability. This is what the payplan site has to say about such debt:

Joint and Several Liability is when you take out and sign a joint credit agreement with another person. This means that both parties are liable for the repayments of the money borrowed.

This includes;

Secured and Unsecured loans
Mortgage
Joint bank accounts
Joint Tenancy
Council Tax
If you have taken out a joint account with another person, this does not mean you are only responsible for half of the money owed. As far as a lender is concerned, both parties are equally liable for the full amount borrowed.

This can sometimes cause problems, especially in cases such as a split in a relationship. If one party decides not make any contributions to the repayments, the other party will be left with the debt. As far as the lender is concerned, the agreement is for either party to repay, if the agreement is not kept to, the lender can either choose to pursue one of the borrowers for the repayments or both.

The monies cannot be paid back twice but both parties can be pursued for the debt.

In other cases, if one party is made bankrupt, they will be released from the legal responsibility to repay the debt, leaving the other person fully liable to make the repayments.

lonestar1

was the O/S Debt in Joint names secured or unsecured ? if unsecured then its possible for it to be made into a 2nd charge on her house (Shes equally liable for the deby if still in joint names) although they usually cant force you to sell

RAS

She definately need to see a solicitor as any joint debt could fall wholly to her if he stops paying.