If the purchase of a property on credit is very often done in pairs, it can be the same for other material goods such as a car, furniture or for the financing of works. Nothing simpler than borrowing as a couple:
- For people married under the community of property regime, it is automatic. Purchases financed with a credit belong to the community.
- A couple can take out a consumer credit together, the property will belong to them jointly if they both sign the sales contract. And this even if the partners, married or partners of PACS do not finance the property in equal parts.
Consumer credit: borrow for two
However, before borrowing jointly, it is important to know the obligations to which the signatories are subject. To borrow for two is to be financially united: if one of the two can no longer pay, the co-borrower will have to reimburse the monthly payments for the couple.
Separation and its consequences
Couple projects financed on credit can be interrupted in the event of separation. The procedures differ depending on the type of union.
Married couple: divorce
A couple who wish to divorce the obligation to have this decision acted on by a family judge in a high court.
90% of married couples are married under the community of property regime, which means that they have not concluded a marriage contract. In this specific case, the couple’s property belongs to both. So you have to share everything:
- If the spouses choose a divorce by mutual consent, they decide for themselves the distribution of property;
- If this is not the case, it is a judge who is responsible for arbitrating the allocation.
For couples who got married under the separation of property regime, everyone takes back what belongs to them. Only goods acquired by two must be shared.
More and more French people choose to go for a wedding: around 170,000 are signed each year, for 240,000 marriages. To terminate a PACS, the couple must send a letter to the registry of the court which had instructed the PACS. The rupture can be done on a joint decision or unilaterally.
If no particular condition is specified in the PACS agreement, the union is then made under the regime of the separation of goods. All goods acquired before and after the PACS are the sole property of its buyer. However in the event of separation, if one of the members of the couple cannot prove that he is the owner of a property then that is declared as belonging to both and must be shared.
Certain couples in a partnership make the choice to unite under the regime of joint ownership. All property acquired after the PACS belongs to both and must, therefore, be divided between the couple in the event of separation. However, property acquired before Pacs, by donation or via inheritance tax, is not subject to joint ownership.
In the event of separation, the cohabiting partners organize the distribution of property themselves. Everyone takes what belongs to them. To facilitate this step, it is important to refer to the purchase invoices to know who financed what.
If the cohabiting partners share a joint account, the property acquired with this money is considered to be subject to joint possession. Equitable sharing must, therefore, be done during the separation.
Separation: cancellation of the co-borrower
What about outstanding credits contracted to two? There are several solutions to obtain the cancellation of the co-borrower guarantee in the event of separation.
The couple can choose to repay the loan in advance, by selling the property for example. Thus, consumer credit no longer exists and the two ex-spouses are no longer united in its repayment;
The couple can apply to the lender and ask to carry the credit over to one borrower. The lender is under no obligation to accept. The borrower must be able to prove that he will be able to repay the monthly payments alone. To facilitate its redemption from the co-borrowers share of credit, he may have recourse to credit consolidation. This solution makes it possible to adapt the monthly payments to the new financial situation.