Could you still be financially linked to your ex?

Your ex’s finances could affect you more than you realise. 

 
There are many things you know you’ll end up sharing with a partner - children, friends and belongings. But what about unpaid overdrafts? A bad credit score? Joint debts?
 
Those who have separated from a partner may not realise how closely tied to each other they still are- even if they’ve both moved on emotionally. 
 
Debt Advice Foundation statistics show that 17% of people blamed a relationship breakdown or divorce as the cause of their financial problems, making it the second highest cause of financial impairment after job loss. 
 
The most urgent issue after a separation, particularly if it was acrimonious, is any joint current or savings accounts you may have together. Anyone named on the account is perfectly entitled to remove any balance plus any agreed overdraft amount, without the say so of the other and you will be just as responsible for paying it back as they are. 
 
Loans and overdrafts work in exactly the same way, with both parties being jointly liable for the whole debt. This could become extraordinarily difficult if they then disappear with no forwarding address, leaving you in the lurch. 
 
One thing you may not think about when you and your partner decide to buy a sofa on credit or get a house together is what happens when you split up, and who will have to pay for what. 
 
Even the split wasn’t nasty, your ex can still cause you issues. Any product in both your names links you financially to that person on your credit report, which can be accessed by anyone you want to take credit out with- like an estate agents if you try and rent a new place.  
 
Their financial history or their future financial behaviour will all have an impact on you unless you ensure those links are severed. It's a good idea to close any accounts or remove their name (or yours) as soon as possible.
 
Once this is done, you also need to get in touch with the three credit ratings agencies; Experian, Equifax and Call Credit and ask them to formally unlink you from your ex. This will ensure that any debts or county court judgements your former partner has now or in the future won’t affect your credit rating. The last thing you want is to try and buy a house with a new partner in a few years to be rejected because of your ex.
 
If you share a mortgage and decide to stay in the house and take your ex partners name off the mortgage, you will have to undergo new credit checks and affordability checks as a single applicant. Suddenly your incomings might not be enough to qualify you for that mortgage, meaning you may need to sell it.
 
Whilst you won’t have to move out if your ex-partner agrees you can stay and you can afford the mortgage, you will need to keep the mortgage in both names- meaning that you share a financial connection. From the opposite side of the situation, you can also understand how this could make your ex nervous, as you are both liable for the whole of the rent or mortgage payments, regardless of which one of you stays in the property. 
 
If you are married, you may think that getting a divorce will solve the problem.
 
Sadly, divorce makes little to no difference. Marriage doesn’t link you financially to your partner- only joint credit or bank accounts can.  Even divorced you can still be liable for debts, and even worse, if you didn’t set a financial agreement during the divorce, you may end up having to share any future wealth. 
 
Former couples who haven’t signed a Consent Order regarding their finances during the divorce risk having their ex come back to claim assets such as lottery wins or business growth, years after the divorce. 
 

Top tips for dealing with finances during a divorce or separation;

 
  • Agree to pay this month’s bills together. Decide whether to remove your ex’s name from the account or stop all wage payments into your joint account and open a new one for it to go into. Move all your bills to this account. If you are genuinely worried that your ex may take more than his/her fair share out, call the bank and freeze the account. After you have both moved your payments/outgoings to other accounts, close the account fully.  
  • Get a copy of your credit report. You can do this for free from ClearScore or Noddle
  • Work out what joint credit you have (married or not, if it’s just in your name, it’s just your debt)
  • Communication is key- lay out either face to face or via text what debt there is and how you propose to separate it. This could be by one person taking on one debt (like the sofa) as the other person is moving out and buying their own. 
  • Finally, once the finances are settled, you will need to contact the credit reference agencies and get them to officially note that you are no longer financially linked. 
If you have separated from your partner and are struggling with debt, call our advisers in confidence on 0800 043 40 50.