Yet another property question

roxy84

Hi again

Right we went BR in April, have our own house etc which now belongs to the OR. We have had the option to purchase both my & oh's BI Back for the £1 plus costs as the house is in negative equity.
We are now discussing the possibility of emigrating to OZ as my oh's trade is in high demand over there.

If we dont buy the BI, i understand that we continue to pay our mortgage as we are doing now and that the OR will have 3 years to do something with the house, right so far?
But what happens when the OR decides to act on this, do they just tell you to leave, how long notice do you get?
If they dont do anything and they hand the house back to us can we say that we dont want it and will the shortfall still be included in the BR?

We are just trying to work out how long we have and if we can still include any shortfall in our BR should we leave for OZ, it is going to take roughly 18 months before we would have our visa's, money etc all sorted out. We would like if possible to stay in our house while we are doing this as it is cheaper than renting at the moment and we cant get a rental anyway because of our BR and we dont have a guarantor etc.

Thanx guys

fiveyearplan

I think Richard_S is having his breakfast but maybe he'll look in on this thread afterwards.

Richard_S

roxy84 wrote: »

Hi again

Right we went BR in April, have our own house etc which now belongs to the OR. We have had the option to purchase both my & oh's BI Back for the £1 plus costs as the house is in negative equity.
We are now discussing the possibility of emigrating to OZ as my oh's trade is in high demand over there.

If we dont buy the BI, i understand that we continue to pay our mortgage as we are doing now and that the OR will have 3 years to do something with the house, right so far? Yep, spot on. If there was equity in your house, and you weren't in a position to purchase the B.I then the O.R would expect the house to sold, to realise the equity. Given that it's in negative equity, then the O.R is not going to do anything in the short term, in the hope that after a couple of years property prices have started ti rise.
But what happens when the OR decides to act on this, do they just tell you to leave, how long notice do you get? You'll get plenty of time to find rented accomodation or make other arrangements. The O.R won't turn you out on the streets, and 12-18 months seems to be what you could reasonably expect if you were required to leave the house.
If they dont do anything and they hand the house back to us can we say that we dont want it and will the shortfall still be included in the BR? Yes, any shortfall from the sale of the house will still be classed as a debt in your bankruptcy.

We are just trying to work out how long we have and if we can still include any shortfall in our BR should we leave for OZ, it is going to take roughly 18 months before we would have our visa's, money etc all sorted out. We would like if possible to stay in our house while we are doing this as it is cheaper than renting at the moment and we cant get a rental anyway because of our BR and we dont have a guarantor etc.

Thanx guys

Hi Roxy,

I'm certain with the way house prices are going that you'll not hear anything from the O.R, until the three year period is almost finished, so wanting to stay in the house for another 18 months shouldn't be a problem at all.

There are some points I'm not certain about though:

• If you purchase the B.I and then decide to sell the house and there's a shortfall; will this be included in your bankruptcy? Or does purchasing the B.I make you liable for the shortfall? I don't think it does, but we can't seem to find out for certain.
• If nothing happens within three years and the house is returned to you, and you sell the house and there's a shortfall; are you responsible for the shortfall?

If you have a decent relationship with your O.R why not write and ask the question? They won't object to you asking reasonable questions about the implications of purchasing the B.I. They may well suggest you take independent legal advice, but they should be able to give you some guidance.

I'd be extremely grateful if you'd let me know what the outcome is if you do contact the O.R.

Richard

dodecanese

Interesting post- Im thinking of the pros and cons of my own house- and the best way to go.
Best of luck Roxy, whatever you decide.

roxy84

Thanks richard

I have spoken to our OR's assistant about this before but about another situation and she said that if we were to buy our BI then the debt would be ours again but ill speak to her again to clarify the situation

Ill let you know the outcome

Richard_S

roxy84 wrote: »

Thanks richard

I have spoken to our OR's assistant about this before but about another situation and she said that if we were to buy our BI then the debt would be ours again but ill speak to her again to clarify the situation

Ill let you know the outcome

Hi Roxy,

That is exactly the feedback we've had from some people who really should have a definitive answer, but clearly don't.

I think its something that we need confirming from a senior member of the I.S or a solicitor, because I just can't see the rationale in why buying a B.I should change anything with regards to the debts associated with a bankruptcy.

There are companies that will purchase a bankrupts B.I in the expectation that the investment will appreciate in time, but they sure as hell wouldn't do that if it made them liable for any shortfall if the house was subsequently sold with a shortfall to the mortgage and secured loans.

If any specialists are lurking we'd appreciate your input.:beer::beer:

Richard

smiales

Roxy, we are in a similar boat, mine is just a bit further down the line and I have purchased the BI but yet to know the full implications of this now that we want to get out of the house! I have a few people hunting for answers from people who should know but we are yet to have anything definitive!

As soon as I know anything or as soon as you do let me know and vice versa! :beer: