My business partner has applied for a IVA as he has debts, one of the loans is in my name as well as his, I can afford to pay my half, but he cant afford his hence the IVA application, we also have a £15000 overdraft in joint names which he is also going to include in his IVA again I can afford my repayments, My wife seems to think that because the loan and overdraft is in my name too IVA will not pay any of this of because we are both responsible for the whole amount not half each????
You are both jointly and severally liable for the joint loans, however if you can afford to make your payments, there should not be a problem.
They will be included in your partners IVA and the creditors will receive a dividend from it.
Sharing from experiences of dealing with debt
The greatness of a man is not in how much wealth he acquires, but in his integrity and his ability to affect those around him positively.
Bob Marley. http://kallis3.blogs.iva.co.uk
Your wife is correct in her assumption, and you should get a copy of your partner's IVA proposal to ensure that he is properly including the business creditors as well as his personal debts,
Partnership creditors may well agree to allow the partnership to continue trading, and you continue to service the debts through normal trading terms, however you do need to bear in mind that this potentially puts more pressure on you now to perhaps reassure your suppliers and the banks that their money is safe.
Apologies Melanie - I assumed the same rules applied as in a personal insolvency.
Sharing from experiences of dealing with debt
The greatness of a man is not in how much wealth he acquires, but in his integrity and his ability to affect those around him positively.
Bob Marley. http://kallis3.blogs.iva.co.uk
They do Jan - but sometimes trade creditors are happy just to let the business carry on trading if only one partner is insolvent. They would perhaps take a more commercial approach.
Sharing from experiences of dealing with debt
The greatness of a man is not in how much wealth he acquires, but in his integrity and his ability to affect those around him positively.
Bob Marley. http://kallis3.blogs.iva.co.uk
Melanie is right, claire.dp. Unfortunately if your business partner is paying his creditors less than 50p/£, you will end up paying more than half of the joint debts. You should ask your business partner's IP for a copy of the proposal to establish how much he intends to repay his creditors.
It's also worth pointing out that this dividend will almost certainly change over the course of the IVA as creditor claims are established, and you will be liable for the full balance of the debt minus what he *actually* repays (not just what he originally *agrees* to repay!).
I am glad that Liam concurs with my advice. However don't be misled into thinking that just because your partner may be paying a percentage of the debt via his IVA they will only come to you for the balance.
If they have to wait for five years to get a dividend, they may well see that pursuing you for the full amount is a much better option - joint and several liability means that you are both equally responsible for paying the whole lot.
