Joint Loan

Wildie

I have a joint mortgage with an ex partner - an aspect of this mortgage is an unsecured loan.

We split a long time ago and I have been paying the full mortgage.

I am now looking to move, the value of the house will pay off the mortgage but wont cover the unsecured loan. There will be 10,500 outstanding. I contacted my ex partner and asked her to go halves on this amount to clear it, that way she has her name off the mortgage and we can move on. However, she wont have any of it.

A friend of mine suggested going ahead with my new property and a new mortgage, then stop paying the loan. That way, both of us could get a CCJ, but it would affect me less as I would already have a new mortgage and don't require credit for anything else? This to me doesn't sound very sensible, but I want to avoid having to pay the full amount back myself.

Any advice??

19lottie82

First off, you prob will find a need for credit over the next six years.

Secondly, a CCJ doesn't mean you won't have to pay either. You maybe get your wages arrested.

Wildie wrote: »

I want to avoid having to pay the full amount back myself.

In fairness, this is what you agreed to when you signed up for the joint loan. You are both responsible for the full amount.

Tixy

Sounds like a bit of a daft plan.

Even if you get a CCJ it doesn't mean that she will pay anything towards the debt. You will still be both jointly and severally liable for the debt.

And they may see you as the better bet to get the money off (with you being the one owning a large asset). They may for example seek to secure the whole debt as a charging order against your new property.

Is she paying anything towards the loan at the moment? or are you paying it all?

What you may be able to do is to go ahead with the new mortgage (assuming that having the outstanding loan won't affect your ability to get accepted for a new mortgage) and then afterwards try to make a settlement offer on the unsecured loan.

Wildie

19lottie82 wrote: »

First off, you prob will find a need for credit over the next six years.

Secondly, a CCJ doesn't mean you won't have to pay either. You maybe get your wages arrested.



In fairness, this is what you agreed to when you signed up for the joint loan. You are both responsible for the full amount.

I didn't mean that the CCJ would mean I don't have to pay the loan, I am happy to pay half - but thought that something would be set up enforcing my ex to also pay towards the loan which she doesn't do at the moment.

somethingcorporate

Read the contract, it won't be the case.

The term is joint and several, you are both liable for the full debt (not 50/50). Least risky for the bank.

19lottie82

Wildie wrote: »

I didn't mean that the CCJ would mean I don't have to pay the loan, I am happy to pay half - but thought that something would be set up enforcing my ex to also pay towards the loan which she doesn't do at the moment.

But you can't guarantee it will work like that.

And remember, you signed the loan agreement that stated that you agreed to pay ALL of it.

Thrugelmir

Wildie wrote: »

A friend of mine suggested going ahead with my new property and a new mortgage, then stop paying the loan.

The debt will impact your ability to obtain a mortgage. You are approaching this the wrong way round.

Wildie

Thrugelmir wrote: »

The debt will impact your ability to obtain a mortgage. You are approaching this the wrong way round.

The debt wont impact me getting a new mortgage with my current partner.

The unsecured loan will only be around £70 per month, but it will take a long time to pay off and I feel it is unfair that I have to pay this on my own when my ex partner has signed for the old mortgage and all that goes with it. If the property was making money, then she would want her share, it should be the same with the outstanding balance.

chalkie99

Wildie wrote: »

The debt wont impact me getting a new mortgage with my current partner.

The unsecured loan will only be around £70 per month, but it will take a long time to pay off and I feel it is unfair that I have to pay this on my own when my ex partner has signed for the old mortgage and all that goes with it. If the property was making money, then she would want her share, it should be the same with the outstanding balance.

I wouldn't be too sure of that on the basis that £10,500 outstanding debt will reduce your borrowing ability for a new mortgage and the fact you ill take a long time to pay off a debt which is only £70 a month suggests you don't have a lot of affordability to play with.

BillJones

Wildie wrote: »

The debt wont impact me getting a new mortgage with my current partner.

How do you work that out then? Current debt will be taken into consideration on any new credit application.

19lottie82

also, remember, if you get a mortgage with your current partner and then you default on the loan, you will trash her credit rating as well, because you will be linked financially. have you discussed this with her?


again, I know it is unfair that your ex is refusing to pay half, but unfortunately it doesn't work like that, and this was detailed in the terms you agreed to when you took out the loan.