Joint and Several Liability

Can you explain "joint and several liability" to me?

If you have taken out a credit agreement, loan or have a bank account in joint names (with another person) then you are both liable for the full amount of any debt.

This means that if you have a joint loan with a spouse or partner and one of you fails to repay the debt (this often happens following divorce or separation) then the lender could still ask you for payment of the full amount (not just half).

The lender cannot recover the money twice but can pursue both of you, or just one of you, for all amounts still outstanding until they have obtained full payment.

Joint and several liability can also apply to rent arrears on joint tenancies, arrears on joint mortgages, Council Tax payments and water charges on properties that have been jointly occupied.

I did not sign any agreement what can I do?

For an agreement to be joint and several then it must be signed by all parties (except for Council Tax). If a lender says you are jointly liable for a debt and you believe this is not the case, it may be worth asking for a copy of the original agreement. If you have not signed it then you are not liable.

For more information on this subject please contact Payplan or your local Citizens Advice Bureau for free, confidential advice.