Will My DMP Affect My Partner? Complete Guide

Are you thinking about a Debt Management Plan (DMP) but worried it may affect your partner’s money matters?

Keep a clear record of your debts, income and essential costs. Free independent debt advice can help you compare the options available where you live.

This article will cover:

•  What a DMP is and how it can affect your partner’s finances
•  Understanding your financial link to your partner
•  How a DMP could change your partner’s credit score
•  The chance of losing your house because of a DMP
•  The good and bad sides of a DMP

A DMP can affect shared budgets and joint borrowing even when only one person enters it. Check liability and affordability with an independent adviser.

Will It Affect My Partner? 

That depends on a number of factors, the most important one being the types of debt(s) that you have. 

Please note that any secured/priority debts that you share with your partner (such as a mortgage) cannot be included within a DMP so you’ll have to keep making payments to those debts as usual. This would mean that these payments would remain the same and would be separate from your DMP. 

A joint DMP may be an option where both partners need help, but it is not automatically the best solution. For a joint and several debt, each borrower normally remains liable for the whole unpaid balance; one person’s DMP does not release the other.

A shared budget can help assess affordable payments, but neither a joint plan nor combining incomes guarantees faster repayment.

You might be surprised to find out that a DMP can be set up between you and your partner even if your partner’s income is different from yours. Furthemore, a joint DMP can still be set up even if your partner has other debts besides the unsecured debt(s) that they owe collectively with you. 

For more information on how to set up a joint debt management plan, you should contact your DMP provider or debt management company. 

You can find also out more about joint debt management plans by clicking here. 

» TAKE ACTION NOW: Fill out the short debt form

Will It Affect My Partner’s Credit Rating? 

Sharing an address or being married does not by itself create a financial association or make a partner liable for sole debts. Joint borrowing and joint accounts require separate checks.

A financial association, such as a joint mortgage or joint loan, can mean that a lender considers information about you when assessing your partner’s application.

Mortgage payments are not reduced through a DMP and should remain priority budget commitments. Reduced payments on a joint unsecured debt can affect both borrowers’ account records; a financial association can also affect lending decisions even if the partner’s own payments are up to date.

It’s important to note that your partner’s credit score will not be affected if they are a secondary cardholder on your credit card account. Only the primary cardholder is responsible for the outstanding balance on a credit card and only their credit report gets affected by it. 

If your partner guarantees a debt, the guarantee may require them to pay when you do not. An IVA or DMP does not automatically release a guarantor. The reporting and consequences depend on the agreement and what happens; obtain advice before relying on a promise of no effect.

Is it Possible that We’ll Lose Our House? 

A DMP is informal and does not itself prevent a creditor from bringing a lawful court claim. Regulated firms must still meet forbearance and fair-treatment duties.

The risk depends on the actual debts, payments and creditor action. Do not rely on an unsupported claim that legal action is extremely rare.

If you’re starting to fall behind on your DMP payments, I highly advise that you contact your DMP provider immediately. A debt management plan is an extremely flexible debt solution. 

Depending on your situation and your circumstances, your DMP provider might be able to reduce payments of your DMP for you. 

An agreed affordable revision can help manage payments, but proposing it does not automatically stop court action. Follow any court deadlines while the provider negotiates.

My suggestion here is to never let it get to this stage. Whenever you get an inkling of the fact that you might fall behind on your debt payments for the month, you should get in touch with your DMP provider and work something out. 

Keep records of the arrangement and tell the provider about any claim or enforcement notice promptly. Do not assume regular DMP payments make every legal step impossible.

In England and Wales, a creditor may seek a CCJ and, where the conditions are met, a charging order over your interest in a home. There are distinct court procedures and protections.

A charging order secures a debt against the relevant interest; it does not transfer ownership or automatically require sale. An order for sale needs a further court process. Continue paying the mortgage and get urgent advice if any court application affects the home.