MONEY CLINIC | My husband is under debt review. Why must my debt be fully paid for him to get clearance?

A Fin24 reader questions why all her debt has to be fully repaid in order for her husband to receive a debt clearance certificate.

She writes: 

My husband is under debt review. He paid up all accounts that were in his name. And only those who are in my name are not fully paid. It seems as if the debt counsellor wants my debts to be paid up before my husband could be granted a clearance certificate, yet I am not the one who needs clearance.

Can you please explain why can't he get clearance when all accounts in his name are cleared?

Benay Sager, Chief Operating Officer at DebtBusters, responds:

It is important to know and declare your marital status when you go under debt review. It is also just as important to choose the right, reputable debt counsellor who will help with asking the right questions in the process.

Judging from this query, the consumer is either married in community of property or has joint account(s) with her husband. If a consumer is married in community of property or has a joint account (often a bond) with another person (spouse or otherwise), then both consumers are liable for repayment of the debt.

As a result, if one of the married spouses applies for debt review, the other person also has to apply.

In this particular case, unfortunately it sounds like this was overlooked or missed at the beginning of the debt review process for this consumer. As a result, even though one spouse has paid up his debt, because the other one has not, a clearance certificate cannot yet be issued. It is very unfortunate to have found this out near the end of the process, but it is important that proper protocol is followed.

Therefore, both parties’ unsecured debts would need to be paid up before clearance certificate can be issued. 

Questions may be edited for brevity and clarity.