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Equity Release - thoughts?

  • Gromble
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22 Mar 12 #319570 by Gromble
Topic started by Gromble
What would happen if, for example, both parties whilst still married took out a £20,000 equity release loan for a specific purpose.

That purpose never happened in the end and the husband spent all the money.

They divorce several years later.

Can the wife claim that, as the original purpose didn''t happen that only the hubby pay the £20k?

Or is it irrelvant that what it was spent on, the debt is joint and both parties are liable jointly?

  • Tets
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22 Mar 12 #319571 by Tets
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I would say it will make little difference, if both parties signed the loan agreement both parties will be held liable by the lender.

  • Fiona
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22 Mar 12 #319573 by Fiona
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Liabilities accrued during the marriage are family debts.

Assets held jointly or solely are taken on the "relevant" date, usually the date of separation. The value of any liabilities and non matrimonial assets (those from before before marriage, gifts inheritances that have not been incorporated into family finances) are then deducted from that figure to give the net value of matrimonial property to be shared.

Hope that helps. :)

  • Gromble
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22 Mar 12 #319593 by Gromble
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OK scratch that example!

The house was bought before the marriage as was the extra equity release.


Then we got married, and her sol is claiming that I owe half of the equity release as it was spent before the marriage?

Essentially, they''re saying I spent all of the equity relase on stuff and, despite the fact the loan is in joint names, they''re saying I owe her half of the amount we borrowed.

Does that make sense?

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22 Mar 12 #319623 by Fiona
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We need to know if the deeds of the property are held in joint names and if the house was bought with the intention of providing a family home.

  • Gromble
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23 Mar 12 #319642 by Gromble
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Yeah, the house was all joint even before the marriage. Everything always has been.

At the time we bought it, there may not have an explicit intention for a matrimonial home, as were not engaged by that time, but we assumed it became one upon getting married.

I just can''t figure out how money we borrowed jointly and has yet to be repaid means I owe the STBX money?

We BOTH still owe the bank. Does it really matter what it was spent on all those years ago?

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