Walking away from joint loans

bluenosewrx

Hi, I've been reading the posts here for a while but never posted myself, there's some great info.

I'd like some advice on my partners situation if anyone can help;

She took out a joint loan with her ex partner because he couldn't get credit. The loan was used to consolidate all of his debts so she effectively had none of the money. When they split the loans got transferred over to a debt collection agency. I know they are entitled to chase either person for the full ammount. But seemingly they are taking no money from him as he totally ignores it and they're collecting from her, only a small monthly ammount but it will hang around for many years.

She has no assets whatsoever so really nothing to fear, i'm wondering what would happen if she just cancelled the payments and ignored the debt collection agency.

She lives in my home now which i own on mortgage, can this effect me at all? IE get my address black listed or try and reposses my home?

evanjonesaber

First of all - you cannot just 'cancel payments and ignore the debt collection agency'. This money has been borrowed and must be paid back.

Dabooka

If you have any joint accounts etc, then yes you're linked. If you don't have any accounts KEEP IT TAHT WAY! Even accounts "just for bills" etc will link you both financially.

With respect to the other question, I'm afraid she has an obligation to keep paying until it's settled. All she can really do is make sure they're aware where the ex lives and leave the rest to them.

barloo69

bluenosewrx wrote: »

Hi, I've been reading the posts here for a while but never posted myself, there's some great info.

I'd like some advice on my partners situation if anyone can help;

She took out a joint loan with her ex partner because he couldn't get credit. The loan was used to consolidate all of his debts so she effectively had none of the money. When they split the loans got transferred over to a debt collection agency. I know they are entitled to chase either person for the full ammount. But seemingly they are taking no money from him as he totally ignores it and they're collecting from her, only a small monthly ammount but it will hang around for many years.

She has no assets whatsoever so really nothing to fear, i'm wondering what would happen if she just cancelled the payments and ignored the debt collection agency.

She lives in my home now which i own on mortgage, can this effect me at all? IE get my address black listed or try and reposses my home?

Yes by all means, she could ignore the Debt Collection letters as her Ex has done, however, be warned, if they have your address then eventually this will get recorded as being a default and registered under her name at your address, and as Im sure your already aware, the Credit scoring system works on addresses, so therefore this could potentially damage your ability of obtaining credit.

Therefore not advised.

If you are seeking a avenue then you could perhaps try disputing the debt. Does your GF have any proof that this money was used to pay off her ex's debts ? If so this avenue is going to be a long drawn out process which would need to get legal (solicitors and court) and there is the possibility that this will not be successful in the end so the only people that win would be the Solicitors.

In my opinion, I would just carry on paying her obligation to pay off a joint loan which she took out in her name.

I know it is not right that her Ex appears to be getting away with it scot free but if you believe in Karma, who knows what will happen. The debt collection agency has his address and could eventually send in bailiffs once they have taken him to court that is. :rolleyes:

Good luck.

nomoneytoday

Credit scores don't go by address, they go on the debtors.
However, if you have a financial product together, such as a joint account, you will be linked.

rsykes2000

barloo69 wrote: »

Yes by all means, she could ignore the Debt Collection letters as her Ex has done, however, be warned, if they have your address then eventually this will get recorded as being a default and registered under her name at your address, and as Im sure your already aware, the Credit scoring system works on addresses, so therefore this could potentially damage your ability of obtaining credit.

Sorry, credit scoring does not work like that, it will only affect other people living at the address if they have a financial link.

ALIBOBSY

Have a look over on the debt boards she can challenge the debt collectors right to collect this money by doing a CCA request. From that she would find out if the debt is legally enforcable.
If not she could decide to stop paying in the knowledge they won't be able to get a CCJ against her, or she could take it to court herself to get the debt written off, or (and this is what I would say is the most use) she could use the strong position to negotiate a full and final settlement to get the debt cleared for good.
Remember the original creditor will have taken the first payments against the debt and then sold it on (more money for them) and written off the balance against tax and the collector themselves will have only paid a low amount to buy it 10-20p in the pound is common.
Offer low to start with, say 10% and negotiate hard.

ali x

ILW

ALIBOBSY wrote: »

Have a look over on the debt boards she can challenge the debt collectors right to collect this money by doing a CCA request. From that she would find out if the debt is legally enforcable.
If not she could decide to stop paying in the knowledge they won't be able to get a CCJ against her, or she could take it to court herself to get the debt written off, or (and this is what I would say is the most use) she could use the strong position to negotiate a full and final settlement to get the debt cleared for good.
Remember the original creditor will have taken the first payments against the debt and then sold it on (more money for them) and written off the balance against tax and the collector themselves will have only paid a low amount to buy it 10-20p in the pound is common.
Offer low to start with, say 10% and negotiate hard.

ali x

Could you let us know the source of that 10 - 20% figure.

never-in-doubt

evanjonesaber wrote: »

First of all - you cannot just 'cancel payments and ignore the debt collection agency'. This money has been borrowed and must be paid back.

Second yes you can and it is called Unenforceability and no it must not be paid back! There is no laws that state it must be paid back, it is an ethical thing.

never-in-doubt

bluenosewrx wrote: »

Hi, I've been reading the posts here for a while but never posted myself, there's some great info.

I'd like some advice on my partners situation if anyone can help;

She took out a joint loan with her ex partner because he couldn't get credit. The loan was used to consolidate all of his debts so she effectively had none of the money. When they split the loans got transferred over to a debt collection agency. I know they are entitled to chase either person for the full ammount. But seemingly they are taking no money from him as he totally ignores it and they're collecting from her, only a small monthly ammount but it will hang around for many years.

She has no assets whatsoever so really nothing to fear, i'm wondering what would happen if she just cancelled the payments and ignored the debt collection agency.

She lives in my home now which i own on mortgage, can this effect me at all? IE get my address black listed or try and reposses my home?

Have a read here: Unenforceability & Template Letters

Basically, so long as you have nothing shared then thats fine. There is no such thing as a blacklist and a lender cannot just pair you without having a financial association made (i.e. so long as you have not jointly applied for anything) then you'll remain independant.

Read here for laws of bailiffs and what they can and cannot do: Dealing with Bailiffs Harassment

poppy10_2

ILW wrote: »

Could you let us know the source of that 10 - 20% figure.

Try googling:
http://www.marketoracle.co.uk/Article12229.html:
"Marlin Financial Services is a debt recovery agency that buys difficult to recovery debts from the banks and credit companies at usually less than 10p in the pound."

http://www.guardian.co.uk/business/2009/jul/05/debt-collectors-private-equity
"Banks unsuccessful at chasing their customers' debts have sold off billions of pounds' worth of unsecured consumer loans to niche agencies at steeply discounted rates - as little as 5p in the pound in some cases."