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Ex has gone bankrupt - buy his beneficial interest?
yaddayadda
Posts: 110 Forumite
We have a large'ish mortgage for our house which is now in negative equity. My ex very generously declared himself bankrupt earlier in the year and the insolvency people have asked if I want to buy the "beneficial interest" for £1.
They've not really explained this to me so can anyone explain what this means in real (layman's) terms?
Do I get all the equity, even though currently it's negative - i.e. will he be entitled to any of the equity if it ever goes positive again? How would this relate to ownership of the property itself?
They've not really explained this to me so can anyone explain what this means in real (layman's) terms?
Do I get all the equity, even though currently it's negative - i.e. will he be entitled to any of the equity if it ever goes positive again? How would this relate to ownership of the property itself?
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Comments
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better asking on the BR forum0
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It means you would be buying his share of any future equity. It doesn't change anything concerning the mortgage or deeds.Accept your past without regret, handle your present with confidence and face your future without fear0
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Then why would they offer it to me if he's left with half the mortgage debt? Why wouldn't they leave him the equity if it doesn't reduce any of his debt?peachyprice wrote: »It means you would be buying his share of any future equity. It doesn't change anything concerning the mortgage or deeds.0 -
would think your better off consulting a solicitor on such an important matter!
Olias0 -
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yaddayadda wrote: »Then why would they offer it to me if he's left with half the mortgage debt? Why wouldn't they leave him the equity if it doesn't reduce any of his debt?
Because secured debts are not included in bankruptcy. It isn't about reducing his debt, it's about realising his assets.
If you choose not the buy the BI the OR will have 3 years to take your ex's share of any equity in the house (if house prices rise), by buying the BI you are protecting your ex from that happening.
On another note, are you aware that if he defaults on the mortgage and the house is repossessed any shortfall will fall entirely to you, regardless of whether it's now, in 1 years time, or 5 years time, he will always be covered by his present bankruptcy.Accept your past without regret, handle your present with confidence and face your future without fear0 -
Thanks guys. He's paid nothing towards the mortgage since going bankrupt but I'm keeping it going myself. I wouldn't get the mortgage under just my name, so I'm happy for him to stay on it in name only for now.
peachyprice - I've no interest in him getting anything out of this, just want to ensure that I'm getting something from buying the BI...
jimmo - with your tax expertise can you confirm that any income from renting the house wouldn't be taxable as it doesn't cover the mortgage and hence I'm making no profit on this?0 -
No matter what you decide to do won't the mortgage be in your sole name?
~Laugh and the world laughs with you, weep and you weep alone.~:)
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