Costs of living are rising and I am struggling

[grant.j]

I have just finished Uni gaining a 1st class financial services degree. I owe £20,000 to the student loan company and £27,000 to other creditors. I obtained a graduate position with a financial services company and decided to restructure my debt as the interest free cards where coming to an end. I was unable to obtain any credit.

My girlfriend offered to put the debt in her name as she has exellent credit and was able to get an attractive rate. My company has cancelled the planned pay rise and bonus. Costs of living are rising and I am struggling. I have a loan for £12,000 in my name and a loan for £15,000 in her name. They are both over five years with the full term to run. I cannot afford to pay both. I will obviously prioritise the one in my girlfriends name as I dont want to affect her credit rating. I dont have any knowledge of IVA's and was wondering if I needed to go down that route (would scupper my career in financial services!) would I be able to include the loan in my girlfriends name without damaging her credit rating? I can clearly show that I owed all the money and then she took a loan and transferred that over to pay off the debts. If not then I may just have to prioritise that and stop paying the loan in my own name as I wont be able to afford it and its already at the maximum term so I cant reduced the payments? Any help would be appreciated.

[Adam Davies]

Hi
You will not be able to put your girlfriends loan in your IVA,even if effectively it is yours.
Your own debts stand at 12k and the student loan for 20k,correct ?
If so your options are limited I'm afraid.
An IVA with only two creditors is not possible,even if it was the SLC would almost certainly decline the IVA.
Bankruptcy will clear the 12k loan but not the student loan.
I suggest that you speak with the loan provider and try to negotiate reduced payments until your income increases
Regards

[MelanieGiles]

In both an IVA and under bankruptcy proceedings your girlfriend can claims as a creditor in her own right as you both recognise that you owe her the money which was borrowed, but as Andy says she remains responsible for the loan in her name.

As you have indicated that you are insolvent, you would be unwise to prioritise one creditor over the others. Would your girlfriend struggle to pay her loan instalments without your financial support? And what are the prospects of you moving to a higher paid job?