Money Borrowing and cohabitingOn September 9, 2019 by admin
Are you going to live together or live together? Then the subject Borrowing money and living together can be interesting. If you live together and you take out a loan for which you both sign, then you are both responsible for this. But what happens if you start living together and one of the two partners already has an existing loan (and the other does not)?
If someone has only taken out a loan, then they will remain solely responsible for it, so nothing will change when living together with someone else. This changes when the partners make agreements about this in a cohabitation contract, enter into a registered partnership or get married.
For example, if you agree in a cohabitation contract that everything is common, then you are both jointly liable for the loans that were taken out before the cohabitation, even if you yourself were not the borrower. This also applies to registered partnership and a marriage in community of property. When you get married under marital conditions, it can be indicated that only one of the partners is responsible for the loan. In short, you have it completely in your own hands. Borrowing money and living together is therefore a subject that you should consider carefully.
Take out a loan together
For loans that are taken out jointly, both are jointly and severally liable for this. In fact, not everyone is responsible for 50% of the loan, but both are responsible for 100% of the loan. This means that if the repayment obligations are not met, the entire loan can be fully recovered from both contractors. It is good to realize this, if everything goes well this will not lead to problems. If you want to take out a loan together, we are happy to help you with this. Our method is aimed at presenting you with the most advantageous offer. You can read here how we do that!
I’d rather not but it happens: You break up
The fact that you have decided to separate is of course a very unpleasant situation in itself, but this also has consequences for your financial affairs. In addition to an inventory of assets and liabilities, it is of course also important whether there was a cohabitation contract, registered partnership or marriage. In a marriage in community of property, both the assets and the debts are shared on the basis of an equal distribution. Despite this equal distribution, you have 100% joint and several liability for obligations that you have entered into together, so the entire loan can be recovered from you. With a cohabitation contract, registered partnership and marriage under marital conditions, this depends on the agreements made at the time of drafting.
If you separate, you may also want to see if the loan can be split. Then each ex-partner has his own loan for which he is responsible. In order to be able to split the loan, two new loans must be taken out to redeem the old loan. For each ex-partner, it must be determined separately whether this new loan can be provided in a responsible manner.
Good Finance can help you with this if you wish. We then make a calculation and submit one or two non-binding offer (s). The quotations will then be sent to you individually. Do you want to see the possibilities for this or do you have any questions? Please contact us or request a free quote!
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