Getting A Name Removed From A Joint Loan

Matt227

Good evening all:)

My soon-to-be-ex-wife and I are currently negotiating the financial aspects of our divorce. We currently have a substantial joint loan with Lloyds/TSB and I am very uneasy about having a financial clean break but retaining a joint commitment. After all, what is to stop her seeking an IVA out of spite and then leaving me solely liable for the full amount? If I give her the funds to enable her to pay off one half of the amount, is there a mechanism by which my name can be removed from the loan?

Many thanks

Matt

p00hsticks

I suspect it's unlikely - at the moment the loan company will both be 'jointly and severally' responsible for the loan, meaning that the loan comany can go after either or both of you to get the loan repaid. They're unlikely to agree to reduce their options by removing one name from the agreement.

Could your ex perhaps get another loan in her name only for half the amount, to enable you to pay the joint one off completely ?

t508

I would say that unless you or your x can refinance the loan then, no, they will not remove one party. Why would they reduce the chance of recovery? They will quiet happily set up payment from one or the other but if things go wrong they will come calling to the easiest target.

zzzLazyDaisy

I agree. One way or another the loan has to be paid off or re-financed. That is the only way you will be able to walk away from it.

Dabooka

I agree, you've no chance of one of you being removed from it or having it split (unless you could refinance as suggested). You say your worried she could go down the IVA route, is the money situation that bad an IVA is possible?

Only asking as the exact same thing happended to my pal when he divorced about 18 months ago.