What will happen to an unsecured loan in joint names if one of the borrowers goes bankrupt?
Obviously it depends on the precise terms of the loan and you will need to look at the loan agreement to find out what they are but, in general terms, most joint loans are owned jointly and severally by all the borrowers and there is usually a provision in the loan agreement that if one of the borrowers becomes bankrupt the other borrower or borrowers are still liable to repay the whole of the loan. For instance, if two of you borrow £10,000 and one of you then goes bankrupt, the remaining borrower will be liable for the whole £10,000 not just half of it, £5,000.
