Bankruptcy and house

hamptonman

Can anyone help here we are moving from our large 4 bed house to a flat ie no mortgage. We are putting this new place in wifes name only. I then owe about 40000 in cards loans etc if I petetion for bancruptcy will the new place be safe, and if not what are my alternatives. I am also solw director of company (has made no profits) will this automatically be taken since I cant then be a director. Any help greatly appreciated

Bethankim

Hiya and welcome,

if ive read right, i take it you have sold your house and using the profit to buy a flat out right?

if so be careful as this could be seen as disposing of an asset and if you have made enough to buy a flat with no mortgage then the Official receiver may take a very dim view, because technically you are not insolvent, as you have the funds to pay off your debts.

Beth

debtinfo

need more details, do you own the large house by yourself or jointly, what will you get in your hand after the sale

hamptonman

The value of current house is 240000 and mortgage 115000 new flat 115000 so after fees not a lot left, just trying to get costs down, and that alone saves us 500 a month. I have gone from 55000k a year job to about 12000 thats why we in mess and cos we borrowed more than we should. Thank you everyone

hamptonman

Oh and forgot, existing house owned jointly

JCS1

Problem is that the current house is owned jointly. So when you put the new flat into your OH's name, the OR will view this as disposing of an asset (i.e. your share of the current equity)

Given the amount, they are likely to appoint an IP who will try and get the money back to go into your BR estate.

please make sure you have spoken to one of the free debt charities to go through your options also suggest national debtline about the limited company.

hamptonman

Or if I ask question another way then how long after we moved would be considered a sensible time for it not to affect the flat 1 year 5 years sorry to sound so dumb but have only just pulled head from sand!!!

Bethankim

I can understand where you are coming from and with no mortgage you can then put every surplus penny into paying your debts off and may have no need to go bankrupt

or you could get professional advice and see if you can do a final settlement to clear your debts now (perhaps at 60p in the pound) - buy your flat with the remainder and have a small mortgage - as you would have a very hefty deposit

what ever you do you need advice - but with £65K as your share in the sale of your house your not bankrupt and wont be in 5 years time either because it will deemed you have a 50% beneficial interest in your flat regardless of it being in your wifes name

My best advice think very carefully and get some serious financial advice

Good luck

debtinfo

please remember that if you go bankrupt both your assets and liabilities are taken into account, it is not just a way of getting rid of your debts. If you try to hide the assets the OR will uncover them as it is their job to do. Additionally you will probably be given a BRO/U which puts restrictions on you for between 2 and 15 years (depending on the severity of the misconduct)

peachyprice

You will have to wait a minimum of 5 years before you you can apply for bankruptcy without having to declare the sale of the house on your BR forms. However, once the OR realises that there is no mortgage on the flar (they will check the land registry as routine) it's likely they will dig far deeper and come to the conclusion that you disposed of an asset, see above for the advice above re BRO/U, restrictions etc.,

Can I ask, as you clearly have enough equity to pay off your debts and still drastically reduce your mortgage why on earth would you want to go through bankruptcy? It makes no sense at all for £40k.

hamptonman

I dont but with a credit rateing that compares to barings bank dont think anyone will give me a mortgage