Borrowing money can be a two person job. Husband and wife or other couple can take out what a money lender would call joint debt or loan. However, just because two signatories are on the loan, responsibilities on its repayment terms and condition are not split into two. Both Parties shoulders full liabilities on the loan. This means that if one of the loan partners defaults on the loan, the one left will is fully liable in paying off the debt.
Types of loans that can be taken jointly
There are generally three types of loans that can be taken out jointly and these are Secured loans such as a mortgage; line of credit for couples with joint account and unsecured loans like a personal loan.
Main Condition of a Joint Loan or Debt
When couples take out a joint loan agreement, they must fully understand that both parties agree to the condition that they are fully liable for the loan and that if one would be in default in paying off the debt the other agree to shoulder the entire loan. This is what they call “joint and several liability” clause. In a joint loan, it does not matter who spends the money or who owns the property from which the money was used. It will not make a difference whether the couple are married, in partnership or have no relation at all. As long as both their signatures are on the loan agreement, both are liable for the whole loan. For instance, if the loan was taken out by husband and wife and for some unfortunate reason one of them dies while the loan agreement is still in effect; the one who is left behind will have to shoulder repaying the amount left on the loan. Of course it’s another story if both of them die while the loan agreement is still in effect.
There is really no proof that couples would have a better chance of landing a loan but the sure thing is that couples can better manage a cash loan singapore than one person can.