I have a joint personal loan and I have recently separated from my partner. I want to split this loan, but the lender said it cannot be done. I asked my ex if he would like to refinance or consolidate his debt, but he doesn't want to do it. He is bad at paying bills on time and I do not want to pay any late fees because he paid his half late or worse, if he doesn't pay at all. I don't want to be hit with a bad credit history. Is there anything I can do to split this loan?
Separation from Partner - Split from Joint Personal Loan?
- Thread starter Ligia
- Start date
Your bank should be helping you with this, but basically as the loan is in joint names then you are both responsible for it. If the loan payments are defaulted on then the 'bad mark' goes against both names. Read your find print on your loan contract there will be a clause for financial hardship (if this is the case) Other than that you are going to have to explain to your Ex (or his parents/siblings) that half of the loan is his responsibility and that it might be an idea for him to get a loan, on his own for half of the closing balance and you do the same. That way the loan is split.
Don't forget to get the new loan for the closing balance - this is the current balance plus all interest and fees up to the date you are going to pay it out. You have to ensure that he has a loan to cover his half otherwise you will pay your half of the current loan and if he doesn't pay his, then it will still be there in both names. You cannot use the argument that you have paid your half. The bank will still see it as a joint outstanding debt.
I cannot urge you enough to ensure you keep the bank in the loop at all times so they know what is going on.
I hope this helps
(20+ years Bank experience)
Don't forget to get the new loan for the closing balance - this is the current balance plus all interest and fees up to the date you are going to pay it out. You have to ensure that he has a loan to cover his half otherwise you will pay your half of the current loan and if he doesn't pay his, then it will still be there in both names. You cannot use the argument that you have paid your half. The bank will still see it as a joint outstanding debt.
I cannot urge you enough to ensure you keep the bank in the loop at all times so they know what is going on.
I hope this helps
(20+ years Bank experience)
Your bank should be helping you with this, but basically as the loan is in joint names then you are both responsible for it. If the loan payments are defaulted on then the 'bad mark' goes against both names. Read your find print on your loan contract there will be a clause for financial hardship (if this is the case) Other than that you are going to have to explain to your Ex (or his parents/siblings) that half of the loan is his responsibility and that it might be an idea for him to get a loan, on his own for half of the closing balance and you do the same. That way the loan is split.
Don't forget to get the new loan for the closing balance - this is the current balance plus all interest and fees up to the date you are going to pay it out. You have to ensure that he has a loan to cover his half otherwise you will pay your half of the current loan and if he doesn't pay his, then it will still be there in both names. You cannot use the argument that you have paid your half. The bank will still see it as a joint outstanding debt.
I cannot urge you enough to ensure you keep the bank in the loop at all times so they know what is going on.
I hope this helps
(20+ years Bank experience)
Thank you for your advice waitingwife. I have told my ex to get another loan to pay off the current one but he said he tried but was declined.
If a letter is typed and is signed by both parties stating I have paid my half and any outstanding monies owing is his to pay will help and be legal if he doesn't pay?
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