Your partner is not usually liable to pay your debts. However they can choose to pay your IVA on your behalf if you cannot afford to do so yourself.
- Does your Partner have to pay your IVA?
- Could they help to pay if you have no income?
- Can your Partner pay off the Arrangement early?
Does your Partner have to pay your IVA?
Legally speaking your partner is not responsible for paying debts in your name. This is regardless of whether you live together or are married or not.
Having said that if you are living with a partner they will be involved with your IVA. This is because when calculating what you must pay into the Arrangement their income will normally have to be included.
Creditors will usually only accept the Arrangement if the payments are based on the household disposable income. Their arguement is that you have both benefited from the debt and so should both help to repay it.
Your partner may have their own debts to pay. They will only be able to continue doing this if they can afford to after contributing to their fare share of the household expenses.
Can your Partner pay your IVA if you have no income?
You may be in a position where you have little or no income of your own. In these circumstances you can still do an IVA. Your partner or any other third party can pay it for you.
This situation often occurs where a couple both have debts and decide to start a Joint IVA. The household disposable income is used to pay both Arrangements even though only one party may be working.
However it is also possible for someone else to support your payments. For example a parent can step in and maintain them you if you cannot afford to do so from your own income.
Instead of supporting monthly payments your partner could offer a one off cash sum. This would enable you to do a Lump Sum IVA with no additional ongoing payments.
Can your Partner pay off your IVA early?
An IVA can be settled early. Generally speaking this requires someone to offer to pay the remainder of your outstanding payments with a single cash sum.
The amount required normally has to come from your Partner or another third party. You cannot use a windfall you have received yourself. This would have to be paid into the Arrangement over and above your agreed payments.
The amount required to settle will depend on your circumstances. If they have not changed and you could carry on with the agreement it will normally have to be equivalent to the total of the amount outstanding.
If you are no longer able to pay your IVA due to a change in circumstances it may be possible to settle for an amount which is far less than the sum of the remaining payments.