Bankruptcy and Ex-Marital Family Home

pooley_2

Hello. need a little advice from you guys! Sorry its a bit of a story as to what I'm currently going through...

I have approximately, £80k unsecured debt, half this debt is from a failed business that I gauranteed with the bank many years ago, currently with a lot of pressure from creditors. I'm employed in a new job on £55k per year (permanent) as previously a self-employed contractor earning double what I am now, so paying these debts back previously was not a problem. Due to the current market status, i had to go into permanent employment and cannot keep up the repayments anylonger.

My debts are as follows

Lloyds Business Banking (Loan) = £30k
Lloyds Business Banking (Overdraft) = £12k
Welcome Finance (vehicle) = £19k
Inland Revenue (Personal Tax) = £13k
Thames Credit (old vehicle finance) = £5k

Having spoken to 2 of the creditors above about my circumstances, they were not willing to accept a lower repayment term other than the one I was on and stated "Due to current economic downturn, we are unable to accept any other repayment methods or figures". The continued to say that "you will have 60 days to repay the full amount before legal proceddings commence which will no doubt involve bankruptcy"

I have already considered an IVA or bankruptcy, but before I pursue one of these avenues, i have a question surrounding my ex-marital home!

I have been seperated for 9 years (i moved out of the marital home), divorced 5 years. I have 3 children that live with there mother. My ex-wife has paid the mortgage on the property for the past 7 years, and I have not. Within the divorce proceedings, a severance of Tenancy was completed, so my ex-wife changed the mortgage into her own name and then she became responsible for the mortgage, however, I've just found out that my name still belongs on the Land Registry as a Proprieter Joint Owner.

Q: If i pursue Bankruptcy, is she likely to lose the house? I wonder how the Official Receiver would see this?

Note: I am a private tenant and do not have a mortgage or any other assets.

I would appreciate your comments and thanks everyone!! ;-)

keepmyhouse

You need to find out how the ownership is held i.e 50/50, if your ex's solicitor was any good all the beneficial interest will belong to her, then the property will be of no interest to the OR, but he will defo investigate!!!!!

I too own a house with an ex, Im going BR, but he dosent care anyway, he would love the OR (official Receiver) to kick me out and sell it, even tho he pays nothing towards it.

pooley_2

Keepmyhouse! - Thank you for your reply.

The house was split 60/40 (the 60% to her), but we agreed although its joint, she would continue to pay the mortgage of which she has done for the past 8 years.

Basically, I have written a will upon the fact that if she dies, i become the beneficary and if I die, my 40% gets passed on to my children. But I've also been informed that If she decides to sell the property (has to be a joint decision) then she has to provide me with my 40% of the equity from the sale of the property.

Anyhow, speaking with the official insolvency guys (.gov.uk) they said they would look at taking the property whether or not she has paid the mortgage for the past 8 years!!

Its a bit of a nightmare really

Thanks

lisamummytoarchieplusbump

i would think that as you do still have an interest with the house ie if she dies then it is classed as an asset as im the forms it does state if in question

8.3 Apart from properties that you own, rent or lease, are there any other properties in which you may otherwise have an interest?

• If you have any interest in or the use of any other property you should provide details of your interest.
• For example you may have an interest in a property under a will, or you may have the use of a property which you pay for but do not have a tenancy agreement. You do not have to live in a property to have an interest in it, for example you may rent a garage or storage unit.

and you said that if shes sells it you do get 40%

im not sure if this means the OR will make her sell it as i dont really know about houses but i do think you will have to declare it as an asset

lisa

tigerfeet2006

Is the house in negative equity?

Your Ex will be able to buy your BI from the OR so she won't necessarily loose the house.

If there is equity then she will have to buy 40% of it. If there is negative equity then she can buy your BI for a nominal £1 plus around £211-250 costs.

So don't panic yet. Do you rent at the moment?

Here is a link to some information from the Bankruptcy Help sticky

Your home/property.

• What will happen to my home? (IS) (pdf)
• FAQ - Bankrupt's Home under the Enterprise Act (IS)
• OR's Case Help Manual - Family Home
• If my house is sold sometime after the bankruptcy order is any shortfall on the mortgage still a debt in my bankruptcy?
• Charging orders in the county court - National Debtline factsheet (useful if a creditor is trying for a CO before your bankruptcy)