What can you do with a joint loan when partners split?

HaSBeenConsolidated

Your daughter's case is very simliar indeed to one I have experience of. May I suggest:
- She firstly talks to the bank about refinancing the loan over a longer period to make the monthly repayments easier to cope with.
- This may result in a lower interest rate applying today, compared to when they took the loan.
- Should she / you be able to make a lump sum repayment, then offer the bank may be willing to offer a 'discount' to close the matter. We have been offered 20% (possible more could be squeezed out of them).
- Next make a formal complaint to the bank if you think you have any grounds for thinking that it should never have allowed your daughter and her ex-P to enter into this J&S Loan Agreement, as it was NOT in HER Best Interests.
- [It would have been much better for each of them to have taken Consolidation Loans to deal with their own portion of the debts].
- If / when this is rejected take the complaint to the Financial Ombudsman. They may reject it - you don't have to accept their decision, but it may well defer the bank chasing your daughter for a year or two.
- Then threaten, in writing, to commence legal proceedings against him.
- Perhaps consider confronting his wife. She may not know about this; she may be appalled, and may put pressure on him to recommence his 50% contributions to the repayments.

The Bank is the Villain: Though this is not the general view in these posts - morally they are, but this view is not currently supported by the law. However I hear that a Treasury Select Committee is looking into this - so your input to them on this case could be helpful in putting this matter right for others in the future.

One thing is for sure that everybody considering entering into J&S Agreements like this with partners rather than spouses should be advised to take independent legal advice. This would help make clear what the 'several' bit means. It appears that many don't and finish up like your daughter has done.

Secondly the system needs changing so that Banks are no longer willing or able to enter such agreements that are not demonstrably in the best interest of each of the parties. Possibly a 'Disclaimer' could be entered into if both the parties still wished to continue.

Good Luck.

John1993_2

HaSBeenConsolidated wrote: »

The Bank is the Villain: Though this is not the general view in these posts - morally they are.

Absolute rubbish. They asked the bank for a loan, agreed to the terms, and the bank agreed to lend to them.

The terms were acceptable to them when borrowing, yet now that she is expected to keep to them the bank are villains?

Sorry, but you are talking absolute rot.

Apples2

HaSBeenConsolidated wrote: »

Possibly a 'Disclaimer' could be entered into if both the parties still wished to continue.
.

Yeah! great idea, something like:

Tick this box to say you have read and understand the Terms and Conditions

It sounds like a great idea, but then, what you actually demand is someone to blame for any and every poor decision you make.
I'm afraid it is your education/parents etc who failed you, not the lenders.

I wonder at what age do you think people should be allowed to make their own decisions?
It clearly isn't 18 so when?

aliasojo

WorriedParent wrote: »

There may be a possible breakthrough here, our company lawyer believes there is precedent where the two borrowers can indeed be separated, especially since the ex has now married.

He is now investigating that case to find what legislation was actually used to force this action, so here's hoping.

Meeting with him on Monday to discuss. :-)

WP

OP...did anything come of this?

It's useful to know simply because there will without doubt be others in this type of situation. Even if the news wasn't good, it's still going to be of help to those who may be going through the same thought process as you.

ampafc

As a 'worried parent', can't you help your daughter out financially? Loan her some money and allow her to pay it back to you interest free over time? Thus saving her career and credit rating?

HaSBeenConsolidated

Do the Banks ever - when signing up Joint & Several liability unsecured loans - make sure that the financial means of the couple are sufficient to repay the loan in the time and at the rates quoted - YES. I'm sure they must.

Do they also test the financial means of each of the individuals to ensure, in the case of either one of them being left to bear the full burden of the repayments alone, that the individual will continue to be able to service the loan without serous risk of default? --- My best guess is that they do not.


Is this correct?


If they don't then you have to ask: Why Not? - Answer because it wouldn't be in the best interests of the bank to do so.

aliasojo

HaSBeenConsolidated wrote: »

Do the Banks ever - when signing up Joint & Several liability unsecured loans - make sure that the financial means of the couple are sufficient to repay the loan in the time and at the rates quoted - YES. I'm sure they must.

Do they also test the financial means of each of the individuals to ensure, in the case of either one of them being left to bear the full burden of the repayments alone, that the individual will continue to be able to service the loan without serous risk of default? --- My best guess is that they do not.


Is this correct?


If they don't then you have to ask: Why Not? - Answer because it wouldn't be in the best interests of the bank to do so.

With respect, it's a business selling a financial product. They are not in the business of nannying people, nor should they be imo.

People should be responsible for thinking things through properly and not just going straight to the 'rubbing their hands with glee' at the thought of the money they've been approved for.

Sure, life throws unexpected curve balls sometimes but that doesn't mean it's the bank's fault if you can no longer cope with your commitments.

[Deleted User]

HaSBeenConsolidated wrote: »

If they don't then you have to ask: Why Not? - Answer because it wouldn't be in the best interests of the bank to do so.

You seem to be under the impression that the bank would prefer not get their money back.

HaSBeenConsolidated

I'm simply standing up for the 'little guy' against the power of the mighty big banks and their bludgeoning power to make money for themselves at other people's cost.

I wonder why so many of the posts on this site appear to be so supportive of the banks. Are these 'posters' employed by the banks to present their stance on various matters and thus to deter the 'little man' from making any real fight back?

Good_Goose

HaSBeenConsolidated wrote: »

I'm simply standing up for the 'little guy' against the power of the mighty big banks and their bludgeoning power to make money for themselves at other people's cost.

I wonder why so many of the posts on this site appear to be so supportive of the banks. Are these 'posters' employed by the banks to present their stance on various matters and thus to deter the 'little man' from making any real fight back?

Little guy that was big enough to arrange a big loan.