Bank Loan

Lyz_Fox

Hi there,
after a bit of advice, my other half and i have separated and we have a joint loan for a car which I am keeping and I am paying. My question is we are off to the bank soon to close the joint account and to tell them that we have separated, will they ask for repayment of the loan as obviously i would like it to continue and the only way for me to pay it off will be to sell the car?
Thanks

InsideInsurance

They wont ask you to pay it off just because you've separated, that makes no difference to them at all but they'll just want the address for each party.

You guys, particularly him I imagine, will want the loan only in your name however most banks will not allow you to make a joint loan into a single person loan and therefore the only way to do it is by settling the loan either by taking out a new loan only in your name or using savings etc

foxwales

If the loan is with the same bank you bank with, then they could hold the account open until this debt is repaid. You are both jointly liable for the debt regardless of who is currently taking responsibility for it.

If the loan is not provided by your bank, then they will close the account providing there are no liabilities outstanding and the account balance is nil.

Lyz_Fox

thanks guys, it is with the bank that i bank with, my only worry is if they do want to settle it and redo it in my name then i think they will say i cant afford it.. eeekkk scary

InsideInsurance

Lyz_Fox wrote: »

thanks guys, it is with the bank that i bank with, my only worry is if they do want to settle it and redo it in my name then i think they will say i cant afford it.. eeekkk scary

They wont make you settle it if you dont want to. The problem if you try to do it but they refuse you a loan in just your own name then you will be stuck with the loan in joint names and you both being liable for it (and it keeps the financial association on your records).

Given you are keeping the car it isnt exactly a bad thing for you but it may make your ex annoyed that he is potentially liable for a debt on the car when he doesnt get to have the car.

JimmyTheWig

Lyz_Fox wrote: »

thanks guys, it is with the bank that i bank with, my only worry is if they do want to settle it and redo it in my name then i think they will say i cant afford it.. eeekkk scary

I think you've missed the point.
The bank _won't_ want you to settle the loan and redo it in your name.

A joint loan means that they can chase either of you for the full amount of money owed.
So lets say you lose your job and stop paying the loan. Your ex still has a job. They will chase him for the payments, because he is more likely to be able to pay than you are. They still get their money.
It's not in the bank's interest to switch from a joint loan to a single loan.

For the very reason above, I can imagine that your ex will want it to be changed to a single loan, or repaid. But I don't think he can force that to happen.

Lyz_Fox

ah, it would appear that i had missed the point.. thank you! so he is unable to force me to repay it and he is also unable to force to take his name off.. gosh that is bad really although it may be helpful to me!

19lottie82

OP - no he can't, in fact I don't even think you can take someones name off a loan.

InsideInsurance

19lottie82 wrote: »

OP - no he can't, in fact I don't even think you can take someones name off a loan.

Legally there is nothing to stop it however it naturally would have to be at the agreement of the bank and almost no bank will, as per the above it is not in their interests to do so as they will be earning the same profit but taking a bigger risk by only having one party to recover the money from in a bad debt situation