Personal loans

[maggie01]

It just occured to me. If a husband or wife takes out a personal loan which the other half knows nothing about. If anything happened to that person, would the partner be liable to pay. ie. if there was no money available, would it mean selling your property to obtain the repayment. The house would be in both names.

[ICEMANSAV]

Do you mean an individual loan based on the collateral of the joint house? If so then yes as the loan would be based on your share of the house (if for example it was you that took out the loan). The only time ( I think!!) that they cannot take the house is if you have a dependant living at that address under 16 years of age, then the loan company would have to provide a payment solution that would allow you to keep the house.

[themas]

1. If the loan is secured on a jointly owned house it could not be taken out without both joint partners being aware of it, as they would both have to agree to it being secured. If a loan is secured and one joint owner dies then - if the survivor cannot keep up the payments - the lender could take Court action which might end with the house having to be sold.

2. If one partner took out an unsecured loan without the other partner knowing about it, it would be owed solely by the person who took it out. If that person dies, the debt is part of his/her estate and has to be paid out of the assets of the estate if there are any. The deceased's share in the house is only an asset of the estate if it was owned as "tenants in common". If it was owned as "joint tenants" then the whole ownership goes to the survivor outside the estate of the deceased. In that case, the only way the lender could get at the property would be to bankrupt the estate of the deceased - something which I think is very rarely done.

[maggie01]

Thank you themas, that's a great weight off my shoulders. Much obliged.