Financial ties can be as harrowing as emotional one: Is your partner a secret debtor?

Hidden money problems are behind the breakdown of one in 10 relationships

Talking about money isn’t the most romantic conversation to have with your partner, but it could end up saving your own pocket and your relationship.

Financial ties can be as harrowing as emotional ones – a recent survey found one in 10 have split up or divorced due to hidden credit-card purchases – so make sure you know how your partner’s finances affect you and look out for tell-tale signs they are hiding debts.

In a survey into credit-card spending habits, comparison website MoneySuperMarket found that of the 15 per cent who admitted to lying to their other half, a third  (36 per cent) said this was because they knew they would be angry. A partner keeping their credit-card bills close to their chest is not necessarily a concern if you’re confident they keep on top of them, but if your household budget is under pressure, secret spending can easily spiral into a much bigger problem for the both of you.

MoneySuperMarket editor-in-chief Clare Francis says: “One of the worries about people who spend in secret is that they do so because they know they can’t really afford it and in the long run it just makes things worse as they can end up saddled with debt and with relationship problems. No pair of shoes is worth that!”

While you cannot be made to pay your partner’s debts, if you have any joint finances such as a mortgage, loan, or even a bank account with an overdraft, you need to be aware the lender will consider you both “jointly and severally responsible”. You are liable for the whole debt, not just half, so if your partner can’t or won’t pay, you can be pursued for the entire debt, whether you can realistically afford it or not.

“You may be directly affected by court action. For example, a charging order may be registered against the home if it’s mortgaged and your partner’s name is on the deeds,” says Jonathan Chesterman of debt charity StepChange. “If your partner was declared bankrupt, and there is equity in the house, you could find you’re forced to sell or buy them out.”

Your credit file and ability to get credit in the future may also be affected. If you have a joint debt, or have previously made a joint-credit application, your partner will show as an “association” on your credit file. If you later apply for credit in your own name, the creditor could decide to check your partner’s file.

Ian Williams of Debt Advisory Centre warns against signing up for joint-credit agreements without knowing all the facts, pointing out that 10 per cent of their clients say their debt problems were caused by a relationship breakdown: “It highlights the importance of reading contracts properly before you sign them. If you’re giving someone else the power to borrow money in your name, are you prepared for  the consequences?”

With all these potential problems in mind, what are the signs that your partner is having money troubles?

Hiding letters and dodging calls will obviously raise some red flags, but there are other signs that your partner is struggling. People often forget that borrowing via a bank account is still debt but charges and interest rates on current accounts are among the highest available. If your bank suspects an account holder is in trouble, they may even take away the overdraft with little to no warning so anyone who finds they are constantly overdrawn needs to take a good look at their spending.

If your partner is constantly flashing the plastic to pay for everyday goods, this could also be a sign that they are failing to make ends meet. Taking out new credit to pay off existing credit is another giveaway that they aren’t coping, and if they are considering using a payday loan, sit them down and ask why. These loans are designed to cover one-off expenses until the next pay packet, but missed-payment charges and interest rates in the payday market are extortionate so the debt can quickly spiral out of control.

Working together to fix your debt problems is important. Be open and honest with each other and try to share the workload if possible. If you both have a grip on the household budget you’ll be in a much stronger position, particularly if either of you is hit with an unexpected obstacle such as falling ill or losing your job. You can protect each other against fixed debts such as loans and mortgages with life and critical-illness cover  or income-protection insurance. Debt charities such as StepChange and Debt Advisory Centre will also help you deal with creditors, find ways to cut back on expenses and check for any benefits to which you may be entitled.

If you do split up, tell the credit-reference agencies and file a “notice of disassociation” on your credit record informing lenders you have no financial links to that person.

“They will probably not be the first on your list when it comes to spreading the bad news, but by separating yourself financially from a previous partner you are protecting your own credit rating for the future,” says Steve Rees of debt consultant Vincent Bond & Co, who explains that you should check your credit record at all three agencies at www.experian.com, www.equifax.co.uk, and www.noddle.co.uk to get the fullest picture as each may hold slightly different information.

Make sure you know your rights. You cannot be forced to cover a partner’s debt if only they signed the credit-card agreement, even if you are an additional card holder who helped build up that debt. If your partner dies with debts, creditors may be able to recover their money by making a claim against their estate, but they are not entitled to pursue you for payment from your own money. If your significant other dies leaving no assets, the debt is not recoverable and you should send a copy of the death certificate to  creditors.

Case study: "He had been gambling on the quiet... hiding the debt for months"

Anne, a teacher from the West Midlands, only knew about her  ex-husband’s debts when bailiffs arrived to take possession of their household goods.

Anne’s  husband had built up debts totalling £70,000 over several years without her knowledge.

“We didn’t live a particularly lavish lifestyle – a couple of foreign holidays a year a new car every five years – but he pretended to be doing better than he was in his career, saying he had a promotion here or a bonus there.

“It was all false though and he had been gambling on the quiet.”

When Anne found out about the debt her husband confessed all.

“He had been hiding the debt for months – opening post in both our names and even saying the phone was out of order to avoid me picking up calls from debt-collection agencies,” she said. 

Fortunately, Anne was able to keep the family home for her and her child but the relationship didn’t survive: “I had a lot of help from a debt charity and it took several years to extricate my finances from his but we are now divorced.”

Independent Partners; Do you need financial advice on your investments, pension or insurance? Book a free consultation with an independent Financial Adviser at VouchedFor.co.uk

Sport
Australia vs New Zealand live
cricket Follow over-by-over coverage as rivals New Zealand and Australia face off
Sport
Hamilton runs down the back straight in the rain
F1
News
Zayn has become the first member to leave One Direction. 'I have to do what feels right in my heart,' he said
peopleWe wince at anguish of fans, but his 1D departure shows the perils of fame in the social media age
Life and Style
Researchers found that just 10 one-minute swill-and-spit sessions are enough to soften tooth enamel and make teeth vulnerable to erosion
health
News
i100
Arts and Entertainment
The Regent Street Cinema’s projection room in the 1920s
film
News
Leah Devine is only the ninth female to have made the Young Magician of the Year final since the contest began more than 50 years
peopleMeet the 16-year-old who has set her heart on being the first female to win Young Magician of the Year
News
Jonathan Anderson was born in Northern Ireland but now based between London, where he presents a line named JW Anderson
peopleBritish designer Jonathan Anderson is putting his stamp on venerable house Loewe
News
Andy Davidhazy at the beginning (left) and end (right) of his hike
video
News
Taylor Swift is applying to trademark song lyrics from 1989
people
Voices
The popularity of TV shows such as The Liver Birds encouraged Liverpudlians to exaggerate their Scouse accent
voicesWe exaggerate regional traits and turn them into jokes - and those on the receiving end are in on it too, says DJ Taylor
Finacial products from our partners
Property search
  • Get to the point
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

ES Rentals

    iJobs Job Widget
    iJobs Money & Business

    Recruitment Genius: Retirement Coordinator - Financial Services

    Negotiable: Recruitment Genius: To provide a prompt, friendly and efficient se...

    Recruitment Genius: Annuities / Pensions Administrator

    Negotiable: Recruitment Genius: You will be the first point of contact for all...

    Ashdown Group: HR, Payroll & Benefits Officer - Altrincham - up to £24,000.

    £18000 - £24000 per annum + benefits: Ashdown Group: HR, Payroll & Benefits Of...

    Ashdown Group: Learning and Development Programme Manager

    £35000 - £38000 per annum + benefits : Ashdown Group: A highly successful, int...

    Day In a Page

    Election 2015: How many of the Government's coalition agreement promises have been kept?

    Promises, promises

    But how many coalition agreement pledges have been kept?
    The Gaza fisherman who built his own reef - and was shot dead there by an Israeli gunboat

    The death of a Gaza fisherman

    He built his own reef, and was fatally shot there by an Israeli gunboat
    Saudi Arabia's airstrikes in Yemen are fuelling the Gulf's fire

    Saudi airstrikes are fuelling the Gulf's fire

    Arab intervention in Yemen risks entrenching Sunni-Shia divide and handing a victory to Isis, says Patrick Cockburn
    Zayn Malik's departure from One Direction shows the perils of fame in the age of social media

    The only direction Zayn could go

    We wince at the anguish of One Direction's fans, but Malik's departure shows the perils of fame in the age of social media
    Young Magician of the Year 2015: Meet the schoolgirl from Newcastle who has her heart set on being the competition's first female winner

    Spells like teen spirit

    A 16-year-old from Newcastle has set her heart on being the first female to win Young Magician of the Year. Jonathan Owen meets her
    Jonathan Anderson: If fashion is a cycle, this young man knows just how to ride it

    If fashion is a cycle, this young man knows just how to ride it

    British designer Jonathan Anderson is putting his stamp on venerable house Loewe
    Number plates scheme could provide a licence to offend in the land of the free

    Licence to offend in the land of the free

    Cash-strapped states have hit on a way of making money out of drivers that may be in collision with the First Amendment, says Rupert Cornwell
    From farm to fork: Meet the Cornish fishermen, vegetable-growers and butchers causing a stir in London's top restaurants

    From farm to fork in Cornwall

    One man is bringing together Cornwall's most accomplished growers, fishermen and butchers with London's best chefs to put the finest, freshest produce on the plates of some of the country’s best restaurants
    Robert Parker interview: The world's top wine critic on tasting 10,000 bottles a year, absurd drinking notes and New World wannabes

    Robert Parker interview

    The world's top wine critic on tasting 10,000 bottles a year, absurd drinking notes and New World wannabes
    Don't believe the stereotype - or should you?

    Don't believe the stereotype - or should you?

    We exaggerate regional traits and turn them into jokes - and those on the receiving end are in on it too, says DJ Taylor
    How to make your own Easter egg: Willie Harcourt-Cooze shares his chocolate recipes

    How to make your own Easter egg

    Willie Harcourt-Cooze talks about his love affair with 'cacao' - and creates an Easter egg especially for The Independent on Sunday
    Bill Granger recipes: Our chef declares barbecue season open with his twist on a tradtional Easter Sunday lamb lunch

    Bill Granger's twist on Easter Sunday lunch

    Next weekend, our chef plans to return to his Aussie roots by firing up the barbecue
    Joe Marler: 'It's the way I think the game should be played'

    Joe Marler: 'It's the way I think the game should be played'

    The England prop relives the highs and lows of last Saturday's remarkable afternoon of Six Nations rugby
    Cricket World Cup 2015: Has the success of the tournament spelt the end for Test matches?

    Cricket World Cup 2015

    Has the success of the tournament spelt the end for Test matches?
    The Last Word: Justin Gatlin knows the price of everything, the value of nothing

    Michael Calvin's Last Word

    Justin Gatlin knows the price of everything, the value of nothing