Loans and credits with two holders
Not only is it easier to get the necessary money, but you can also enjoy better financing conditions for your common project. We are talking about loans and credits that allow a second co-owner to be included when accessing the necessary financing.
Pros and cons of loans with co-ownership
By having a guarantee greater than two incomes to ensure loan or credit repayment, lenders often offer better deals for couples. That is, a better profile with greater bargaining power allows you to obtain higher amounts easier, without the need to provide another guarantee or guarantee (except mortgages).
However, it should be borne in mind that loans with two holders also carry risks. Both holders are linked to the same financial institution and both are responsible for paying regardless of who uses the money. In addition, especially in case of separation, resolving custody of these debts, contracted as a couple, can be problematic.
Before requesting a couple loan, you can also consider a guarantee. This option also has its advantages and disadvantages. Thus, it depends on your economic situation and the purpose you want to finance. It is better to apply for a loan with two holders when the project to be financed is joint and will be enjoyed by both managers.
Custody of couple loans
If you have a personal loan in force being the two holders, the lender will continue to consider both of you responsible for repayment of the existing credit, even if you separate. That is, the legalized divorce does not affect the responsibility that you both have acquired with the lender. Before a situation of facing the separation and distributing the common debts, there are several alternatives that you have:
Cancel the loan
In this situation, canceling the loan is usually the option with fewer complications. However, this solution can be problematic in some cases, when the funded project cannot be sold to repay and cancel the loan, for example a common housing reform or a trip made as a couple.
When it is not possible to cancel the loan, another possibility is to make a change in the ownership of the loan and transfer the debt to a single holder. Then, one of you will become the only person responsible for credit repayment. This option involves both more procedures and commissions for the modification of the contract. For the lender to make these changes, the economic level of the person who remains the sole holder must be sufficient to guarantee the repayment of the loan.
Continue to share the credit
The third option is to create a joint account for loan repayment. Each of you must enter monthly in this account the part of the quota that corresponds. The main advantage of this option is that it allows you to avoid unnecessary paperwork and commissions. However, a mutual trust is necessary that each one will fulfill his obligations. Thus, it depends on the relationship you have with your ex-partner.