Emotions and coping with the children’s concerns may be your immediate worries when you split from your partner.
But even if financial concerns don’t seem as important, it’s a good idea to try to sort out any money problems and get separate finances as soon as possible.
I’m going to look at four main areas which are important for separate finances:
- benefit claims;
- establishing a new address for the person moving out;
- deciding how to deal with debts; and
- unlinking your credit records.
The division of assets isn’t really a topic for Debt Camel, so all I will say on that is that it’s best to go for mediation if that is at all possible – it means less lawyers’ fees and more assets to share.
1. Benefits
If you are already claiming any benefits, then one of your first actions needs to be to tell them that you are now single. Unfortunately unless you are on Universal Credit, this means telling everyone separately – don’t assume that if you tell the Job Centre they will inform HMRC (for tax credits) or your local council (for Housing Benefit and Council Tax Reduction).
It can take several weeks or longer to get your new benefits sorted out – the change over from a joint tax credits claim to a single claim for example can be slow, so the sooner this is started the better.
If you had a joint current account before, this is also the time to get a new account in your own name only and get the benefits paid into there.
If you haven’t been claiming any benefits before because your combined incomes were too high, you need to see if now you are single you are entitled to any help. To find out what you could get a good place to start is the Turn2us calculator. You could also visit your local Citizens Advice Bureau.
2. Establish new address
Whoever is moving out needs to establish a new address and inform everyone of it. It’s quite common for people not to bother telling their bank etc because if you are on good terms with your ex, they will pass on your letters. If you are staying with friends or relatives for a bit, you may not think it’s worth the hassle of changing everything.
However, this can cause major problems for your ex if they have made any benefits claims as a single person. It is now common for people to find their benefit cases are being investigated in detail and benefits are stopped during this because the benefit authorities don’t believe someone is single when their ex’s post is still going there.
People you need to inform include: your bank, your employer, any benefits agencies and DVLC. It’s also a good idea to register with a doctor and dentist where you now live.
It can be difficult to supply the proof of address if you are just staying with someone so you don’t have any bills in your name – a local Credit Union can sometimes be helpful.
If you are both planning on staying in the same house but want to claim any benefits as single people, I recommend you go to your local Citizens Advice Bureau and discuss this.
3. Deal with debts
The top priority has to be to prevent any debt problems getting worse. So no matter how friendly you currently are with your ex, it is better to be safe than very sorry so make sure you:
- change any pin numbers or passwords on accounts (including your email account) that your ex might know.
- if your ex has a card on your credit account, inform the credit card company that the other card can no longer be used.
- if you usually use a joint account, open an account in your name only and switch your income and benefits to this new account and also your essential bills. Don’t assume you can safely carry on using a joint account.
Legally splitting up makes no difference to your debts:
- if a debt is in your name, it remains your debt. This applies even if the bank loan you took out was used to buy a car for your ex, or if your ex had a second card on your credit card account and ran up most of the bills. Legally these are both your debts.
- if a debt is in joint names, the creditors can usually chase either of you for the whole amount – the debt isn’t going to be halved so you can each deal with your half.
Get things sorted and split up as soon as you can
If your separation is amicable, it’s best to have a conversation about the debts as soon as possible. Your ex may be happy to carry on paying your bank loan for their car. You may both agree that getting rid of the overdraft on your joint account is top priority so the account can be closed.
You also need to insist on seeing evidence that an account has been closed – do not believe your ex if he says he has dealt with it, he may just be saying that because he is going to get around to it soon, or he may think it’s not that important…
A bank will usually want you both to say that an account should be closed or changes into only one name, so if you haven’t signed anything, I am sorry but you need to be suspicious.
Sorting out these type of “it’s my debt but I shouldn’t be paying for it/shouldn’t be paying for it all” type of situation is best treated as a priority so that a “clean” separation can be achieved quickly.
Guarantor loans
If you are the guarantor for a loan your ex has, you should consider if you can be removed as the guarantor. The lender may have assumed that you could afford the loan repayments because you two were living together and sharing bills, but the lender should have also taken into account what your finances would look like if the borrower stopped paying because they were out of work or you had split up… as the lender probably didn’t think about this you may have a good case to be released as the guarantor.
If you are the borrower for a guarantor loan you too can complain – if you win the complaint the interest will be removed from your debt which will make a big difference.
Mortgage
A joint mortgage can be a big problem. It is very common for a mortgage lender to refuse to remove one of the names from a joint mortgage. The person that wants to take on the whole mortgage has to be able to clearly afford it on their own, which can be very difficult to prove.
The first time in your life you have money problems?
It is usually much more expensive for two people to live separately than together. So if your previous debt situation as a couple was manageable with little trouble, it may now not be so. This can be a very sudden problem and one which you have no experience of.
You need to start by making a list of all your debts and draw up a new budget, based on your new income – if it doesn’t look as though the debts are affordable, read A Simple Road Map of Debt Solutions to get a feel for what your options might be.
At this point you may still have a great credit rating and be able to borrow more money. But borrowing so that you can pay off other debts is a very bad idea, as it then means you have a bigger problem and fewer options. It’s better to face up to facts and get some good debt advice on what you can do.
4. Unlink your credit records
You are going to remain linked to your ex financially so long as you still have joint accounts, so it should be an aim to close these accounts as soon as possible.
Once joint accounts have been closed, you should check your credit records with all three Credit Reference Agencies. If any of them are still showing you two as linked, then you can ask for “financial disassociation”, which will remove this link.
Here is a page for each of the three Credit Reference Agencies which describes how you need to contact each of them to ask to be unlinked:
Sometimes people ask if it’s worth bothering with this – I think it is. Here is the story of a reader who said “My ex has ruined my credit rating & I can’t get a mortgage”
There is no benefit in keeping your credit records linked once you have separate finances. If you have a poor record, it isn’t going to be improved if you are linked to someone with a good record (well not unless you intend to apply jointly for credit, which you aren’t going to do now you have split up!)
And if you both currently have good credit records, it’s going to be very annoying a couple of years down the line if you apply for a mortgage and get refused because your ex has messed up a mobile contract and has a couple of missed payments showing.
Ending an abusive relationship
It is only recently that the importance of Financial Abuse in a relationship has been appreciated. It is more wide-spread than was thought because people often don’t want to talk about it, perhaps because they don’t realise that it is an important factor.
If you are in a safe house trying to rebuild your life, then benefits and a place to live are probably top of your list, not debts, they can wait..
But once you are in a more stable situation, I suggest going to your local Citizens Advice and talking about financial abuse and the debts you have been left with. They may be able to help you get some of these written off, or it may be best to go for a “clean start” with a Debt Relief Order.
A simple guide to your debt options
How to take a “financial selfie”
Joint debts – after you split
Ricky @ The Skint Dad Blog says
It’s never nice when a relationship ends and when there are financial matters to take care of I expect it can make it a whole lot worse. Although I know it would be the sensible thing to do, I cringe at the thought of having ‘that’ conversation with Naomi as I wouldn’t want her thinking the wrong thing.
I suppose the best thing to do would be to keep finances as easy to sort out as possible so god forbid the relationship did go sour, the financial side of things would be painless.
Sara (Debt Camel) says
Hi Ricky, personally I think that keeping your finances separate for the first few years together is a good idea, but as you say, what a difficult conversation to have! In a long relationship though it’s natural that they get entangled – continuing with my “loan for a car” example, whoever has the better credit score would probably apply for a loan. And as soon as you add in children, mortgage and other assets such as pensions, it really is difficult to get a “fair” solution when there just isn’t enough money to go round.
MaryG says
My estranged husband and I had a joint bank account which only he used. Without my knowledge, he allowed it to go into default in July 2013 and eventually the debt was sold to a collection agency. The first I knew about it was when I got my credit report for a separate reason. It transpired that he had intercepted all the letters and the default notice addressed to me from the bank and never told me what was going on.; he has since offered to pay a proportion of the debt, which was accepted, and the account is closed. I took the matter up with the bank and with the Financial Ombudsman but they are adamant the default will stay on my file. This is now causing me serious problems as I will have to buy a house when my divorce is finalised and will need a small mortgage. Apart from that account, my credit rating is unblemished. I am devastated by his actions and don’t know where to turn.
Sara (Debt Camel) says
If the Financial Ombudsman has rejected your complaint, the only further option would be court action. From what you have said, it sounds as though technically it was correct to default your record. Obviously I can’t be sure about this from this brief exchange – you could consider going to your local Citizens Advice with all the paper work and asking if they have any suggestions – but I don’t see anything that would suggest court action would be a good idea.
But if you will have a large deposit and only need a small mortgage, then talk to a mortgage broker. If a “normal” broker says no, you could consider a “bad credit” broker, who could almost certainly get you a mortgage. That wouldn’t be cheap, so you would have to look carefully at the fees and interest rate.
Mariam says
I lent my ex £800 and he doesn’t want to pay me. He said I’ll sort something out for soon but nothing. He keeps ignoring my texts. The only proof I’ve got is text messages saying I’ll sort something out for you soon and a bank statement that shows I transfer the money back in September. I also got a bag of £50 online and he never paid me back, I also got a text of him saying can you do me the favour and I pay back and I sent a message as well saying it got it and he said thanks.
I want my money back, do you think I can take it to court? Or
Please help me :)
Sara (Debt Camel) says
It’s often difficult to get money back from a friend – see https://debtcamel.co.uk/friend-owes-me/ – but it’s even harder with your ex. I suggest talking to your local Citizens Advice.
biglesleyc says
I’m trying to give some solid advice to a friend.
Here’s his situation.
He and his wife of 15+ years shared a mortgage on a house. They borrowed further against the house so there’s not much equity, if any.
They seperated out 2 years ago with a view to divorcing. She rented a property. He stayed in the family home until recently when she ordered their home to be sold (this hasn’t happened yet). She has run up a huge amount of debt. She has just died leaving financial carnage behind.
Question: Is he responsible for the debt she ran up whilst they were seperated? Because they were still legally married, could he be responsible for all debts run up, whether hers or his?
He is very gloomy about his future and doesn’t know which way to turn. I’d be grateful for a bit of direction : )
He cannot work because of disability and it’s highly unlikely he’ll be able to work for the foreseeable future. He claims benefits.
Sara (Debt Camel) says
I think your friend is going to need to take debt advice, I can answer some factual questions, but he needs someone to look help look at all his debt, benefits and housing options – the best place to go is his local Citizens Advice.
He is not responsible for any consumer debts she has run up, whether before or after their separation unless it was a joint debt or he acted as a guarantor. If she had some bills in her name relating to the house they both lived in (council tax, utilities) then he may be liable even if he wasn’t named on the bill.
Linda says
Hi, my ex husband was paying my car instalments each month as I had given him the cash equivelent to finish his car finance off, unfortunately, we split soon after, I was on benefits and he stopped the car paýments, so I arranged with the car company to pay £50 a month until my divorce hearing which I did. In court my husband was ordered to finish this debt off in lump sum, which it was, but this is now on my credit file and I cant get credit, what can I do please? Thanks in advance, Linda.
Sara (Debt Camel) says
Technically the default is correct as payments were missed. You could try writing to the creditor and asking them to remove the default as a good will gesture, enclosing the court judgement.
(NB I am assuming here that there were no issues about financial abuse here – see https://www.moneyadviceservice.org.uk/en/articles/protecting-against-financial-abuse. If there were, then i suggest going to your local citizens Advice and asking if they could write the letter to your creditor.)
Lee says
Hey Sarah I have tried to check my credit score and. It shows I have a balance of £189 on my account that was in 2011 and this is now 2016 no one has ever made in contact or told me about this as I was not aware as well my x partner had a joint account and need her removed from me as she is giveinf me bad credit too what can a do about this
Thanks lee
Sara (Debt Camel) says
Hi Lee,
the article above covers closing a joint account and telling all three credit reference agencies that you should no longer be linked with your ex.
This https://debtcamel.co.uk/debts-you-dont-recognise/ looks at what to do if there is a debt on your credit report you didn’t know about.
Anna says
Hello Sara,
I am writing for advice on behalf of my partner and for my own sanity.
My partner (of 5 years) and his ex were together for 10 years. They had 2 kids a mortgage a ton of communal debt 75k (credit cards, store cards etc) they did an voluntary arrangement with their debtors 8 years ago, but ran all the debt back up, plus took out equity loans so no equity in the house.
They have been split up over 5 years but she has kept the house which is still in hers and his name.
When they first split up he went to a solicitors who told him he had no chance of getting a court order to get her to sell the house, as she has numerous other small children with various different men.
She is on benefits and can’t take over the mortgage on her own and he won’t sell the house as he fears for his children’s future.
She doesn’t keep up with the mortgage repayments and this is only adding to his awful credit history and stopping him from resolving his issues.
Of course he pays everything he should to her for the kids and keeps up all his debt repayments from his side.
This awful situation is stopping us from being able to move on with our lives and build our future.
Is there anything he can do to disassociate himself from their mortgage without taking his name off it as he can’t?
Please help this is killing me.
Anna
Sara (Debt Camel) says
I think he needs to take full debt advice, on the mortgage, any other joint debts remaining with the ex and debts in his own name. Ultimately his only option may be to go bankrupt – not a nice option but the longer he leaves it, the longer it will be until it is sorted. If the mortgage cannot be afforded, then even if he would prefer his kids to live there, this isn’t going to be possible.
If he would like face to face advice, his local Citizens Advice would be good, otherwise National Debtline on 0808 808 4000.
Miss Maro says
Hi Sara,
My ex and I had a joint account over 15 years ago which we closed amicably together after the split. My ex didn’t feature as a financial associate until recently and I don’t understand why. Has there been any changes to how financial associations are listed, or should I be worried?
Sara (Debt Camel) says
Have you looked at all the debts listed on your report in detail? All those still open and closed? Are any of them. Joint accounts? Anything you didn’t expect to see?
Miss Maro says
Hi Sara,
We only ever had one joint account (bank). This was closed down over a decade ago.
M
Sara (Debt Camel) says
Then ask the CRedit Reference Agencies for a Financial disassociation, as the article above suggests .
Julia says
A few years ago, I opened a catalogue account in my ex husbands name. I am divorced and living with our two children on long term sickness benefits. I couldn’t get an account in my own name as I have a very poor credit history of almost zero, due to many debts accrued over the years. I have been mating the repayments of this account but recently, the buy now pay layers are all coming to fruition and making my normal repayment larger and larger. I am just about keeping on top of it at over £120 a month but the situation is only going to get worse over the next six months as the minimum payment starts to double. I don’t know what to do as it is my responsibility and not my ex husband whom I actually have a good relationship with because of our children. Should I write to the company explaining it is my actions and my responsibility? The current debt is £3900 but with the buy now pay laters not even all added on yet and a 45% interest charge monthly, thus situation is going to swiftly get out of hand. I have long term anxiety and depression and this is starting to impact on my quality of life with the worry 😔
Sara (Debt Camel) says
This is very difficult. Legally it is your ex’s debt and the lender will probably not even speak to you about it.
Can I ask some questions?
Does your ex know you have been using the account?
When did you last buy something on the account?
In the divorce, were there any financial arrangements?
Does your ex pay child maintenence?
Do you have other debts at the moment – are you behind with any bills?
Julia says
Ex husband knows about the account now although not how much is outstanding and also didn’t know at the time about me opening it. It was last used a month ago and yes, he pays me child maintenance. We divorced 10 years ago but have regained close friends because of the children. I personally have lots of debts and repay them all at £1 a month as an arrangement with each individual lender. I have about 19 in total. I’m not behind on any other bills or utility bills.
Sara (Debt Camel) says
I think you have to come clean to your ex about you not being able to afford the repayments. Unless he can pay them, thei is going to harm his credit record :(
But there isn’t a way around this. You can barely afford to pay them at the moment and when the BNPLs end the minimum will jump.
If your ex can afford to repay this, you could pay him at a lower level?
Obviously you have to stop using the account.
Julia says
Okay, thank you Sara