Tenants in Common and Bankruptcy

jimmya

Hi.

New poster here and keen to learn about bankruptcy and charging orders in particular.

My wife and I own a property (mortgaged) jointly, but I only own a small percentage of it (10%) as we own it as ''Tenants in Common''.

I have unsecure credit card debts all in my name and was wondering about what could happen if I was made bankrupt as I am having problems paying off these debts.

If I was made bankrupt, could the OR only go after my 10% interest in the home, and would it be likely that we would be made to sell the house?

Same question regarding charging orders. Could these only be fixed on my 10% beneficial interest?

Thanks

j

fiveyearplan

Welcome!

Do you have any charging orders now? If not, you don't have that worry, if charging orders are in the process then you need to make yourself bankrupt before they become final. Once bankrupt they won't be able to get a charging order for your debts.

Have you spoken to any of the debt charities yet? There is a guide to bankruptcy sticky on the front page of this forum which has a lot of useful information - I'd start there if I were you and then come back here with any other specific questions. Sorry I don't know where you stand with the tenancy in common.

debtinfo

The key question is when how and why you only own 10% of the property

jimmya

Thanks for the replies.

Firstly, no I dont have any charges on the house....yet! And I havent spoken to any charities yet, I'm researching a little bit first.

To debtinfo... my wife and I have been ''tenants in common'' as opposed to ''joint tenants'' since 1999, when she severed the joint tenancy simply by writing a letter and sending it off to the Land Registry. This was because she had put more financially into the house (paid the deposit, paid for most of the improvements, etc), and at that time I was being made redundant, so she took over paying the mortgage.

Whereas joint tenancy automatically means both partners own 50%, tenants in common allows you to state the share of the house that you own. It is between you and your partner as to what those percentages are, we chose 90 and 10%. As my earnings have been more precarious than hers as I have been self employed for 8 out of the last 10 years, it seemed prudent to do so, and has certainly turned out that way now, hence my questions about bankruptcy.

So I wondered if there was anyone here with experience of this, and am I 100% correct in believing that if I was made bankrupt I would only be liable for 10% of the assets of the property, as all the debts are in my name?

j

debtinfo

That would be the starting procedure however the OR can apply to court for this to be overturned if it is seen that you had deliberetly changed the shares to avoid your creditors from getting a fair share. It would seem in your case because of the length of time involved and if your partner put in a lot more initially and has made larger and more regular payments to the mortgage then it may stand. If for instance you changed it just before going bankrupt then the OR would immeadiatly apply to have it overturned.

Do expect thogh that as per there job they will want a thorough explanation of the circumstances so i would have plenty of information prepared as to the timings reasons and relative contributions over the years

jimmya

Thanks for your reply debtinfo.

j

sicon75

Hi, I understand that if i sever my joint tenancy then my share of the property is mine to do as i please, but does this allow me to rent my share out to someone or does the tenant in common have to agree? thanks

sicon75

Hi, I understand that if i sever my joint tenancy then my share of the property is mine to do as i please, but does this allow me to rent my share out to someone or does the tenant in common have to agree? thanks

tigerfeet2006

This is the Bankruptcy board Sicon, I would suggest you post a new thread on the House Buying, Renting and Selling board.