Hello Dollar.

Because a trust deed is an individual thing, and because each of you is fully liable for the full balance, the full debt is listed for each of you in the list of trust deed creditors. Each of you, individually, will be treating this creditor fairly compared to your other creditors.

Will your inheritance outweigh your full debt total?

Hi, I think I follow that explanation. I originally thought my trust deed was for £31,500 but the paperwork I received from the trustee last week showed it as £39,000. That is likely to be in the regions of my inheritance. I thought there might have been something spare but unfortunately it doesn't look like it now.

If the joint account is paid off in full thanks to your inheritance it will mean your husbands other creditors are likely to get a slightly higher dividend Dollar.

Sorry if my explanation wasn't very clear, it isn't the easiest thing to explain as instinctively it can seem a little unfair in these circumstances that a joint creditor stands to get more back. I suppose one way to look at it is that they benefit from the extra security of having two people named on the account.

Hi Dollar. FYI If you do end up paying off the joint debt in full through your trust deed then you would be entitled to make a claim in your husband's trust deed and receive some of the funds that would have paid to the joint creditor from his trustee.

Probably not a huge amount of money I imagine given the joint debt is relatively small, but worth knowing anyway!

I always wondered this too - myself and my partner took out a bank loan and the full remaining balance shows on both our Trust Deeds so pushes the amount we owe up by about £4,500 each. I have asked my relationship manager on a few occasions why this is but was always told this is just the way it is. Thanks to TDA's answer, it all makes sense now!

Glad I could help dm29, and that my explanation made some sense!!

From posting in the forum for a few years I'd say that explaining this situation, and also how disposable income is worked out where only one person from a couple is going ahead with a trust deed, are the hardest to convey in an understandable and concise way.

Hi Kevin and TDA-Just wanted to check my understanding on this re. joint liability.
If the repossession goes ahead and I opt for bankruptcy or the lender applies for it on the basis of the shortfall created,

1.my payments from disposable income would be apportioned to the lender and others
2.My husband would be pursued for the entire amount of the shortfall

If both the above are correct, could/should my husband then claim repayment of half of the assessed shortfall from the trustee responsible for my bankruptcy?

Hi Pamjo.

I know little about this subject so hopefully Kevin can expand on his comments when he next visits the forum.

That's right Pamjo, though please note that whilst the value of his claim would be half of the shortfall, he would only receive his pro-rata share of the funds available to creditors from your bankruptcy - eg 5p in the pound or whatever it might be.

Also, your trustee might insist that he organises a formal assignation of the debt from the mortgage lender before admitting the claim - or at least he would need to be able to provide evidence that he has settled the debt in question in full.

Maybe best not to get bogged down in the technicalities, but suffice to say that this would be possible with a little effort on your husband's behalf. Whether it is worth the effort would depend upon how much is likely to be gathered in to your bankruptcy and shared out between creditors