{"id":2502,"date":"2014-01-06T12:05:10","date_gmt":"2014-01-06T12:05:10","guid":{"rendered":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/?p=2502"},"modified":"2019-02-28T12:05:13","modified_gmt":"2019-02-28T12:05:13","slug":"iva-and-partners-credit-rating","status":"publish","type":"post","link":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/iva-and-partners-credit-rating\/","title":{"rendered":"IVA and Partners Credit Rating"},"content":{"rendered":"\n

Co-habiting partners, whether married or not, share most aspects of their lives. Although each partner often earns their own income independently of the other, many couples share the burden of paying for their normal living expenses on a mutual basis. <\/p>\n\n\n\n\n\n\n\n

In theory, each partner might be expected to discharge expenses proportionately to their income. In practice however, there may be a great imbalance between the respective incomes of the partners. It would not be uncommon for one partner to earn say two thirds of the household income with the other partner earning one third. You would expect that the partners in this example would pay the living and household expenses on a similarly proportionate basis i.e. at a ratio of two to one. <\/p>\n\n\n\n

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

However, let us suppose that the lower earning partner is much more extravagant than the other and incurs huge liabilities on overdraft, credit cards and unsecured loans to the extent of being insolvent.<\/strong> They enter into an IVA<\/strong> to address the debts<\/strong>. In such a scenario each partner is personally liable for their own debts and both partners are liable for jointly incurred debts.<\/p>\n\n\n\n

How will the solvent partner be impacted?<\/h3>\n\n\n\n

When the insolvent partner enters into an IVA, creditors will expect to see a statement of income and expenditure<\/strong>\n for the household showing how living expenses are addressed and paid \nfor. They will expect each partner to pay expenses in the same ratio as \ntheir income. A key consideration in all of these matters is whether the\n partners have agreed to pool their resources when they began to cohabit\n or indeed at some point thereafter. Even without a formal agreement, \ncreditors may imply from the evidence of their lifestyle and expenditure\n that they have so done. In many cases the solvent partner may agree to \nassist the insolvent partner in their IVA by contributing some or all \ntheir own surplus income to the IVA.<\/p>\n\n\n\n

It is hard to see therefore how the insolvent partner\u2019s IVA would not impact on the solvent partner\u2019s credit rating<\/strong>.\n The IVA proposal will have addressed any joint debts, with joint \ncreditors receiving a dividend from the IVA. However, at the end of the \nterm of the IVA, the solvent partner will be fully liable for the \nrepayment of any unpaid balances remaining on joint debt. Indeed the \nsolvent partner would be expected to maintain the full contractual \nrepayments on joint debts, even during the life of the IVA. The solvent \npartner may also have to deal with the reluctance of creditors to lend \nfunds, knowing that the other partner is insolvent and in an IVA.<\/p>\n\n\n\n

Nevertheless, many people have successfully completed their IVA \nwithout negatively affecting their solvent partner. A well constructed \nIVA will deal with all matters relating to income and expenditure, \nassets and liabilities and afford both partners an opportunity to fully \nand finally heal their financial woes.  If you think you may be \ninsolvent while your partner is not then you should consider consulting \nwith an Insolvency Practitioner, otherwise known as an IP, as a first \nstep. A reputable IP will look at all of your financial circumstances \nand will determine very quickly if you are insolvent or not. You should \nincur no costs in obtaining this advice. If you are in fact insolvent, \nyour IP will go on to advise you on all of the options open to you and \nyou can choose the best option for yourself.<\/p>\n","protected":false},"excerpt":{"rendered":"

Although each partner often earns their own income independently of the other, many couples share the burden of paying for their normal living expenses on a mutual basis. <\/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":"none","_seopress_titles_title":"","_seopress_titles_desc":"","_seopress_robots_index":"","footnotes":""},"categories":[7],"tags":[],"class_list":["post-2502","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\/2502","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=2502"}],"version-history":[{"count":5,"href":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/wp-json\/wp\/v2\/posts\/2502\/revisions"}],"predecessor-version":[{"id":3173,"href":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/wp-json\/wp\/v2\/posts\/2502\/revisions\/3173"}],"wp:attachment":[{"href":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/wp-json\/wp\/v2\/media?parent=2502"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/wp-json\/wp\/v2\/categories?post=2502"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/wp-json\/wp\/v2\/tags?post=2502"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}