We're aware that some users are experiencing technical issues which the team are working to resolve. See the Community Noticeboard for more info. Thank you for your patience.
📨 Have you signed up to the Forum's new Email Digest yet? Get a selection of trending threads sent straight to your inbox daily, weekly or monthly!

Joint loan and divorce...

Options
Firstly hello! new here, so hi! :-)
I have a problem and would appreciate some advice if anyone can help?
I am recently divorced and my ex and I have almost sorted the financials apart from a joint loan we have.
Without going into to many specifics, as a result of the divorce, my employment position changed in that I am now seeking work and the bank have mostly come to agreements on the overdrafts, loans etc. however I still may be made bankrupt.
What I need advice on is the joint loan we have still.
The loan is in both mine and my ex'es name, and as part of the financial contract she would like her name to come off the loan (£25k) and it be solely mine. This is something that the bank will NOT allow, however the divorce contract, when sealed by the court, must be respected by them.
So my questions are:
If I do end up bankrupt and the loan is in both names, will the bank persue my ex? And if so, for her 'half' or the full amount?
Will the bank sue me if I sign the contract (knowing it is against their wishes) and the loan is in my name only?
Many thanks in anticipation, please help stop my hair falling out!
Regards, SR.

Comments

  • Brock_and_Roll
    Brock_and_Roll Posts: 1,207 Forumite
    Part of the Furniture 1,000 Posts
    Whatever the divorce contract says, it wont affect the enforcability of the loan against you both, jointly and severally. (otherwise people would get married and divorced as a ruse to avoid paying their debts!)

    Clearly, the bank is not going to remove her name from the loan - especially as they know your currently financial situation. If you go bankrupt they will pursue your ex for the entire outstanding debt.
  • Tixy
    Tixy Posts: 31,455 Forumite
    Hi and welcome

    Can only answer one of your questions I'm afraid - hopefully someone else can answer the second bit.
    If I do end up bankrupt and the loan is in both names, will the bank persue my ex? And if so, for her 'half' or the full amount? Yes, certainly and for the full amount

    Will the bank sue me if I sign the contract (knowing it is against their wishes) and the loan is in my name only?
    You might need to take advice on the second bit from the bankrupcty forum.
    A smile enriches those who receive without making poorer those who give
    or "It costs nowt to be nice"
  • immoral_angeluk
    immoral_angeluk Posts: 24,506 Forumite
    10,000 Posts Combo Breaker
    Was a consent order included in your divorce?
    Total 'Failed Business' Debt £29,043
    Que sera, sera. <3
  • Hi everyone and thank you for your replies :-)
    Was a consent order included in your divorce?

    Yes, the consent order for my divorce covers everything - kids, house, finances; the lot...?
  • susiesromeo
    susiesromeo Posts: 3 Newbie
    edited 28 April 2010 at 3:14PM
    Whatever the divorce contract says, it wont affect the enforcability of the loan against you both, jointly and severally. (otherwise people would get married and divorced as a ruse to avoid paying their debts!)

    Clearly, the bank is not going to remove her name from the loan - especially as they know your currently financial situation. If you go bankrupt they will pursue your ex for the entire outstanding debt.

    Thanks Brock. When I spoke with the bank, they acknowledged that they had to respect the order of the court whereby if the Judge ordered her name from the loan, it had to be made so. You are saying this isn't the case?
  • the_insider
    the_insider Posts: 795 Forumite
    Unless the bank were a party in the court order then they don't have to pay any attention to it.
    Getting married 02.08.14
    Wins for the wedding: membership for a 'wedsite' and app, £35 gift voucher for party supplies shop, £50 worth of hand painted signs, 1kg of heart shaped marshmallows :money:
  • immoral_angeluk
    immoral_angeluk Posts: 24,506 Forumite
    10,000 Posts Combo Breaker
    I would contact your solicitor as really the debts should've been specified in the consent order, which would remove your liability for the loan but it doesn't automatically mean the company take your name off. I have a consent order for a welcome finance debt and they refuse to take my name off, even though they know I'm not liable for it, until it's settled.
    Total 'Failed Business' Debt £29,043
    Que sera, sera. <3
  • Remember, the lender will not take anyone off the hook, unless they are ordered to specifically.
  • Brock_and_Roll
    Brock_and_Roll Posts: 1,207 Forumite
    Part of the Furniture 1,000 Posts
    I take it you have nothing in writing from the bank about their willingness to remove your name? It may be that the underling that you spoke to does not fully understand the situation.

    Whilst they might "respect" the court order, unless they were a party to the case, then they are not bound by it. As a banker myself I would be amazed if they agree to take a joint mortgage name of the mortgage without being forced specifically by the court to do so.

    Form the bank's perspective, they have two people on the hook at the moment. One of these will have assets and an income, the other is planning to go bankrupt. Its a no brainer! If they do remove exes name, let me know who the lender is and I will switch my mortgage andget divorced!!!
This discussion has been closed.
Meet your Ambassadors

🚀 Getting Started

Hi new member!

Our Getting Started Guide will help you get the most out of the Forum

Categories

  • All Categories
  • 350.9K Banking & Borrowing
  • 253.1K Reduce Debt & Boost Income
  • 453.5K Spending & Discounts
  • 243.9K Work, Benefits & Business
  • 598.8K Mortgages, Homes & Bills
  • 176.9K Life & Family
  • 257.2K Travel & Transport
  • 1.5M Hobbies & Leisure
  • 16.1K Discuss & Feedback
  • 37.6K Read-Only Boards

Is this how you want to be seen?

We see you are using a default avatar. It takes only a few seconds to pick a picture.