Is this illegal?

Teethingtroubles

Hello

Long story short: my partner has (marital) debts which haven't been paid towards for a couple of years. We have discussed with them 50% full and final settlements based on a family loan to him it now appears that he won't need the loan from a family member as his ex wife has given him a (small) lump sum ( against his share of the FMH equity) would it be totally illegal to go ahead with the 50% reduction on the debts even though he would have some of this lump sum left over ( would be used to buy work tools and a mode of transport as after two years of being unemployed he's been offered a self employed contract)

Would he need to declare how much he has as a lump sum?

The total amounts doesn't cover all of the debts IYSWIM.

He's not bothered about them showing as partially settled on his credit file as he has many defaults from these loans.

If he wasn't able to keep some of these funds to himself he would really struggle getting back into work due to needing a run around and tools.

glentoran99

Why would it be illegal? If the creditor agrees a reduction it doesnt matter if its all your money or a small precentage

sourcrates

Hi,
Dont understand why you think this would be illegal.

You always negotiate the best deal you can with your creditors, that's just common sense, it matters not a jot where the money comes from (as long as its from a legal souse), if theres money left in the pot, after all debts are settled, thats a bonus, so to answer your question, No, its not illegal.

enthusiasticsaver

Once a settlement has been negotiated it is "full and final" so even if he has received a bit of a windfall, or really it is just presumably buying his share of the FMH then this is a separate issue so no it is not illegal to continue with the settlement.