How to deal with joint debts

nik_k

I am in the process of calculating my debts, so that I can approach Payplan for some help. However, when putting figures into their debt calculator, I am unsure as to how to deal with my wife's debts.

Is there such thing as a way of dealing jointly with our debts, or is it normal to deal with them separately?

My debts total approx £3K, whilst her debts are approx £15.5K. Whereas in principle these debts are all joint debts, I presume that legally they would have to 'belong' to either one or the other of us.

I am the only earner. Therefore, any DMP/IVA/other arrangement(s) would have to be paid from my earnings. As such, it would be beneficial to have a joint arrangement, as it would be impossible financially to find money each month for 2 arrangements, or to find money for 1 arrangement (for my wife) then find money to pay my debts outside of an arrangement.

I'm sure this question is a highly common one, but I just can't find any information on any of the websites I've looked on.

Thanks in advance for any advice!

nik_k

Hold on, I might have found the answer myself...

If they are liable for only a relatively small amount of debt (including joint), say £10,000 or under, then they will not be able to do an IVA in their own name as the cost would be disproportionate to the amount of debt involved. In that case, you can put forward an IVA in your name, but the household budget will have to allow for your non-IVA partner to continue making their monthly debt payments (including that on the joint debts) in full. This might mean however that there's not enough left over to meet your own IVA payments. If their payments are still too high, then they could enter into a debt management plan to reduce their payments, but they'd still end up paying their debts in full.

So...that would mean I would have to consider a separate agreement, and try and work both payments into our household budget.

Is this correct?

~Beanie~

Your second post relates to IVA's which may not be the best solution for you and therefore may not apply to you anyway.

You can do a joint DMP, include all debts that you both hold and make one payment each month. See this previous thread where this has been discussed:

http://forums.moneysavingexpert.com/showthread.html?t=1188981

newlywed

Hi, you can do a joint DMP and include the joint income and joint debts and make one payment. Contact CCCS or Payplan for advice - these both set up FREE DMP's with no additional charges and if an IVA or whatever is more beneficial in your situation, they will advise you of that too.

As for an IVA if only one of you goes on an IVA then the other person will still be chased to pay up on the joint debt.

With a joint debt you are each liable for the FULL amount, so if one stops paying/goes bankrupt etc, they can chase the other for the full amount.