A divorce is usually very sad and then there are all kinds of financial aspects involved. Do you have a loan and are you getting a divorce, what are the consequences? As a mediator, Good Finance is happy to assist you in this.
If you both signed the loan agreement at the time, you are both jointly and severally liable for the entire loan. This means that if the payment obligations are not met, both contractors are liable for the entire loan. Even if you are divorced and the loan continues to run, you are both fully liable. This means that if one of the former partners does not meet the financial obligations, the lender can recover the loan from the other former partner.
The mutual agreements for after the divorce are laid down in a divorce agreement. If there is a loan, it will also be included here. The repayment of the debts will be agreed on how the distribution will be made to repay the loan.
Take over a loan in 1 name?
Sometimes it is possible that one of the former partners takes over the entire loan, in which case the other former partner is released from the joint and several liability. If you want a divorce to assess whether it is possible for one of the partners to take over the loan, this must be submitted to the lender. Good Finance can help you with this if required. We can contact you for the lender and have a calculation made as to whether it is justified to put the loan in one name. We will also check for you whether it is possible to make the current loan cheaper by transferring it at a lower interest rate.
If the lender does not agree with the joint and several liability dismissal, the lender can still appeal to both contractors.
Split loan after separation
There are possibilities to divide the loan between the two former partners, this can be done by splitting the loan. If the loan can be split up, a new loan will be taken out for both former partners. With these two new loans, the old loan is repaid for everyone’s part and the former partners have a loan separately.
Whether splitting the old loan into two new loans is possible will have to be assessed. Both loans are assessed separately in a new loan application. Each ex-partner must be sufficiently creditworthy on the basis of income and fixed costs to bear the new loan. When the old loan can be taken over by two new loans, each ex-partner is responsible for his or her own loan.
Good Finance has credit specialists who can handle a new loan application and can inquire about the possibilities with different lenders.
Loans contracted before marriage
Many people do not realize that loans entered into before marriage with a marriage are tied to both partners. An exception to this is if the partners have agreed on marital conditions in which agreements have been made about all the conditions of the marriage and the division in the event of a divorce.
If you are confronted with a divorce and you have questions or do you want to refinance the loan? Feel free to contact us without obligation. We are happy to help you further!