{"id":1304,"date":"2013-12-17T11:59:39","date_gmt":"2013-12-17T11:59:39","guid":{"rendered":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/?p=1304"},"modified":"2019-01-30T12:02:16","modified_gmt":"2019-01-30T12:02:16","slug":"joint-debts-in-an-iva","status":"publish","type":"post","link":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/joint-debts-in-an-iva\/","title":{"rendered":"Joint Debts in an IVA"},"content":{"rendered":"\n

A joint debt is a debt taken out by two or more people but in most cases just by two and for the sake of simplicity in this article we will assume that there are just two parties to a joint debt or liability.\u00a0 <\/p>\n\n\n\n\n\n\n\n

The joint parties to the debt may be a married couple, co-habiting partners, siblings who may live together, parent and adult child, business partners or some such parties who have something in common, be it family, personal or business. <\/p>\n\n\n\n

\"Couple<\/figure><\/div>\n\n\n\n

Joint loans are attractive to the lender because each of the \nsignatories to the loan is individually liable to repay it. If something\n goes wrong \u2013 for example if partners separate or one of the parties to \nthe loan dies \u2013 the lender can go after the other party for all of the \namount of the loan remaining unpaid. This is the principle frequently \nreferred to as \u2018joint and several liability\u2019. What this means simply is \nthat in law the borrowers are both jointly and individually liable to \nrepay the debt.<\/p>\n\n\n\n

Joint debts can be secured \u2013 such as a mortgage taken out by both \nparties on a jointly owned property \u2013 or unsecured \u2013 such as a joint \ncurrent bank account.<\/p>\n\n\n\n

The key thing is that both parties signed the original credit agreement when the debt was incurred.<\/p>\n\n\n\n

If one party, being insolvent, enters an IVA and the other party, \nbeing solvent, does not, all of the unsecured debt of the insolvent \nparty is entered into the IVA including the whole of any joint unsecured\n debt. Should the IVA be approved, creditors will expect to receive \ndividends on all of the unsecured liabilities in the IVA, including the \njoint unsecured liability. However, the solvent party, who is not in the\n IVA, will be expected to keep servicing the joint debt as well in \naccordance with the terms of the credit agreement or as re-negotiated by\n the solvent party directly with the lender. The lender of the joint \nloan will usually get repaid from two sources: dividends from the IVA \nand normal repayments from the solvent party. If the debt is not wholly \nrepaid at the end of the term of the IVA, the solvent partner remains \nfully liable to repay all of the unpaid balance.<\/p>\n\n\n\n

There are many other examples of joint and several liability: secured\n loans taken out by both parties; tenancy agreements entered into by \nboth parties; HP agreements entered into by both parties; council tax \nand certain utility agreements where both parties sign up. Strangely, \nmany credit card agreements are not joint liabilities, even though two \n(or more) parties may be card holders. This is because only one of the \ncard holders was a signatory on the original credit agreement but the \nlender decided to offer the borrower the facility of making the \nborrower\u2019s spouse or partner a second card-holder.<\/p>\n\n\n\n

In a nutshell then, joint liabilities must be included in an IVA, \nregardless of the wishes of the solvent party. One way to avoid this \nwould be for the solvent party to clear the debt prior to the IVA \ncommencing.<\/p>\n","protected":false},"excerpt":{"rendered":"

A joint debt is a debt taken out by two or more people but in most cases just by two and for the sake of simplicity in this article we will assume that there are just two parties to a joint debt or liability.\u00a0<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_seopress_robots_primary_cat":"","_seopress_titles_title":"","_seopress_titles_desc":"","_seopress_robots_index":"","footnotes":""},"categories":[7],"tags":[],"class_list":["post-1304","post","type-post","status-publish","format-standard","hentry","category-iva-articles"],"_links":{"self":[{"href":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/wp-json\/wp\/v2\/posts\/1304","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/wp-json\/wp\/v2\/comments?post=1304"}],"version-history":[{"count":1,"href":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/wp-json\/wp\/v2\/posts\/1304\/revisions"}],"predecessor-version":[{"id":1314,"href":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/wp-json\/wp\/v2\/posts\/1304\/revisions\/1314"}],"wp:attachment":[{"href":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/wp-json\/wp\/v2\/media?parent=1304"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/wp-json\/wp\/v2\/categories?post=1304"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/wp-json\/wp\/v2\/tags?post=1304"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}