My Partner is Unemployed with £20k Debt

Nick_K

Hi Everyone,

I am sorry if this isn't the right place to post this.

Me and my partner are 30 years old, and we have been together for nearly 3 years. I have just purchased my first property solely in my name, and my finances are in good order. Unfortunately, my partner's finances are in shambles. I knew that she had some debt but I finally managed to convince her to share everything, and it is much worse than I imagined. Between loans, credit cards, overdrafts and car repayments, she owes over £20k. To add to this, she has just finished a year of full time education and currently has no work. She is looking for work, but it isn't going well as she is a newly qualified teacher in a time where all schools are shut and nobody seems to be hiring. 


She has taken out loans just to cover loan payments, and her minimum payments currently add up to over £600 p/m. She has just started claiming universal credit which pays about £400. She has promised to send me a full breakdown of her debts, but I'm not sure what I can do to help. I have just taken on a mortgage and I'm not sure I could take out a loan to help her consolidate her loans, even if I was comfortable doing that. She has been paying most of the loans for years, and has paid back the amount borrowed in that time. Is there any hope that any of her creditors would consider writing off the remaining balances? Other than that, I'm simply at a loss for ideas. I would appreciate any advice on this matter. It has weighed on her mental health for a long time, and it is already causing me a great deal of stress.


Many thanks,

Nick

[Deleted User]

You need to find out the status of each debt. If she's defaulted and she's been paying little towards them for some years, she may be able to get a settlement figure.

Lenders won't just write off the debts. Although she may think she has repaid the amount borrowed, she hasn't, as much of her repayments will have gone towards the interest.

Best thing to do is get her to post on the DFW boards.  I would also advise not financially associating yourself with her if you haven't already.  

foxy-stoat

IVA or bankruptcy or Debt Management Plan.  All will take time.  Good lucks

Nick_K

Deleted_User said:

You need to find out the status of each debt. If she's defaulted and she's been paying little towards them for some years, she may be able to get a settlement figure.

Lenders won't just write off the debts. Although she may think she has repaid the amount borrowed, she hasn't, as much of her repayments will have gone towards the interest.

Best thing to do is get her to post on the DFW boards.  I would also advise not financially associating yourself with her if you haven't already.  

She has not yet defaulted on any of her debts. She has been paying each month, even taking out extra loans to make sure she could cover the existing payments. It really is the closest thing to a blackhole I have ever seen. She has end dates based on the amounts she is paying, and also has access to settlement figures if she was to repay the outstanding balance today. The issue is that there is no way of paying off those balances.

RobM99

How about asking companies to freeze any interest?

[Deleted User]

Get her to the DFW boards. She needs to sort out the problem as whole, instead of just kicking the can down the road. It's almost certainly going to involve some kind of debt solution and the associated impacts.

Grumpy_chap

Hard though it might seem, the year getting qualified as an NQT probably was a good investment and your partner should be able to get employment starting September as teachers are always in short supply - she may have to choose a less-good school, or one further from home than she'd like, or supply-teacher, but very little reason to not have work and a £25-£30k salary coming in from September.  Schools will be re-opening and kids will still be there - if anything coronavirus will force smaller class-size, which means more teachers needed.

That salary is the first step to her getting the debts resolved.  You did not mention any debts associated with the education she has just received(?).  You are looking at consolidation etc, which is obvious. Can she release any funds to pay down the debts by any other means, for example sell the car that she can't afford?

As others have said, she needs SoA and post on the DFW board.  

Do you live together?  That will impact her UC if assessed as a couple.

MovingForwards

Do not take out any loans in your name to clear her debts. Head over to the debt free wannabe board and they will offer guidance. Better still, ask your partner to join up and post, that way she is dealing with it.

FrugalCat

.

I have an old friend that went out with a lady that couldn't handle money. He paid off her debt when they were together. They split up at some point, but she turned out to be pregnant. Because of the child, the friend ended up paying off the ex-girlfriends debt a few more times. She never did learn how to handle credit and finally he took the child into his care and let her go bankrupt.

Moral of the story: Some lessons need to be learnt the hard way.

enthusiasticsaver

She needs to stop taking out loans to make repayments.  That is making it worse and you should not take on any of the debts in your name. She will need some sort of debt solution.  Tell her to contact the free debt charity stepchange.  Realistically though if she is on universal credit she will not be able to pay.  She can post on the DFW forum but I would suggest she open a bank account with no overdraft with a bank she does not owe money to and moves all essential bills to that along with the universal credit.  She will then need to inform her creditors she cannot afford to make repayments and default.  She will then have to learn to live without credit. 

es5595

As above, she needs to deal with it and want to deal with it. Without her being motivated to do so, she’ll just relapse again and again. 

To be quite frank, and assuming you can “carry” her for a little while, I’d be looking at bankruptcy to wipe the slate clean. 

On a first year NQT salary, with some careful juggling, she can avoid a monthly payment, and be clear in a year before her salary jumps up. 

As you’ve just bought the house, I’d assume you wouldn’t be looking to remortgage with her for at least a few years, so it will have little long term impact. 

Although, she needs to get her head out the sand and take careful stock as well as proper advice.