Fixed Loan on Mortgage

icklechick13

Hi

My partner and his ex have got a fixed loan that he has 18 month left to pay (was 5 year).

When they separated they looked at their joint debt, mortgage and this loan etc etc and it was decided that my partner pays £999 per month towards half of these bills. In addition to having the child 50% of the time he also pays for her to attend kickboxing and karate at £65 per month and contributes separately for things such as school dinners, clothes etc.

They have an 8 year old daughter together. The mother set up a 2 day rolling rota for caring for the child, which has been working for both for the past 18 month. The problem is that nothing is legalized because of the high solicitor fees.

My partner is now fed up of his ex dictating changing times or arrangements to suit her but never been able to have a say himself and also her constantly making it difficult for him/us and using the child as a weapon. For example if she wants to keep the child an extra day that would not normally be her day she does it anyway but when he actually asks her if he can for special occasions i.e his birthday in February she always says no!!

His partner lives in the house in question in which the loan is secured against although we have lately been told her new boyfriend is staying there more and more.

My partner is now considering using the money he is currently paying out to fund the solicitor costs and get it all legalized in one go. He could probably get a decent solicitor for 2 grand who would be able to sort this out and then he is happy to restart the repayments for the loan and mortgage after his is done. Obviously his ex will not be able to carry on with the payments alone so the question is what will the loan people do if he misses two payments? Is he better notifying him of what he intends to do? I think the benefits of sorting this our far outweigh the penalty charge that will probably be added to the loan.

Any help will be much appreciated.

imoneyop

icklechick13 wrote: »

Obviously his ex will not be able to carry on with the payments alone so the question is what will the loan people do if he misses two payments? Is he better notifying him of what he intends to do? I think the benefits of sorting this our far outweigh the penalty charge that will probably be added to the loan.

Assuming the loan is joint.

He'll be wrecking his and his ex's (although I doubt he cares about that) credit histories for the next 6 years.

Even if he notifies them that is what he intends to do, he will still be breaking the contract he agreed with them when he tool the loan out, so they will record it on his credit history.

If the loan is in his name only then he's just wrecking his credit history.

icklechick13

I would have thought if they affected his credit score for the sake of two payments he might as well not pay the loan again as the result would be the same... I would have thought they would extend the loan by the two months and then maybe add a penalty charge for the missed payment.

It is in his name but she is the guarantor i believe

imoneyop

icklechick13 wrote: »

he might as well not pay the loan again as the result would be the same... I would have thought they would extend the loan by the two months and then maybe add a penalty charge for the missed payment.

It is in his name but she is the guarantor i believe

If he stops paying altogether then they will eventually default the loan, and get a CCJ that will have far more affect on his credit history than a couple of missed payments.

If she is the guarantor then he could mention to her that he is thinking of stopping paying and that as she is guarantor for the loan she'll have to pay it all back (a dirty trick, but seems fair if she is using their child as a weapon)

Tixy

would have thought if they affected his credit score for the sake of two payments he might as well not pay the loan again as the result would be the same

If he misses 2 payments then they will likely show 2 missed payments on his credit file. If they agree to a repayment holiday in advance and agree not to show missed payments on his file then it wouldn't affect his file.
Or they may agree to a repayment holiday or reduced payments and say they will mark it as an arrangement to pay on his file (also a negative).

As to that being the same as not paying at all - if he stops paying the loan altogether it will be marked as a default on his credit file which is much worse than 2 missed payments and would be visible for the next 6years) and in theory as the loan is secured on the property then could look to consider court action and even repossession, again much worse than having 2 missed payments on file.