edx bankrupt...losing house help?

kev1744

Hi all,
Im looking for some advice for my neighbour.
Basically she is in a terrible situation. Her ex partner who left the matrimonial home 5 years ago has gone bankrupt.
She has continued to live in the home with there 3 young children and has managed to pay the mortgage with no defaults.
However now the receivers have got involved and are looking to force a sale of the home in an effort to reclaim some of the debts from her ex.

She is unable to buy anywhere else as her funds will not allow it, the mortgage company will not allow the ex,s name to be taken off the mortgage as again her finances show she would not be able to keep the payments up (even though she has done just that for 5 years)

Does she have any kind of avenue to keep occupancy of the property? Is there a standard time limit the receivers give to maybe allow her time to explore some sort of rescue plan?

Really would like to try and help her so any advice is thankfully received.

kev

kepar

Is there and if so how much equity is there in the property?

debtinfo

Also were, they, married, possibly divorced, if so was there a consent order, what exactly has been sent to her so far

silvercar

How much equity is there in the property? ie the difference between its current value and the mortgage.

I wouldn't be too worried about his name being on the mortgage at this point, if she manages to secure the beneficial interest and to pay the mortgage, his name on the mortgage means little.

kev1744

hi all,
ok to answer the questions.
yes they were married, now divorced.no agreement was drawn up for him to surrender the property to her or the kids.
i think there is about 30k equity in the property.
i believe she has spoken to the mortgage people and they have said that she wouldnt be able to take the mortgage on by herself, problem is receievrs have said as long as his name on mortgage they will have a claim to it?
3 kids are all young and its the only home they know.
really hope there is something that can be done.

silvercar

kev1744 wrote: »

hi all,
ok to answer the questions.
yes they were married, now divorced.no agreement was drawn up for him to surrender the property to her or the kids.
i think there is about 30k equity in the property.
i believe she has spoken to the mortgage people and they have said that she wouldnt be able to take the mortgage on by herself, problem is receievrs have said as long as his name on mortgage they will have a claim to it?
3 kids are all young and its the only home they know.
really hope there is something that can be done.

SHe will need to come to an arrangement with the receivers to buy out his interest in the property that now vests with the receivers.

They may be prepared to deal with it now, or they may want to wait for a couple of years to see what the property market does.

If she has any plans to buy back the ex's beneficial interest, she is better off if her mortgage is interest only so she is not repaying capital as repaying capital will increase the equity in the property and increase the amount required to buy it back.

£30k equity is £15k each. That's a starting point. She could argue that selling it would deliver less after legal costs and estate agents fees. But she is talking about a few thousand at least, possibly more.

Once she has bought the Beneficial Interest, the ex is out of the picture apart from being liable for the mortgage. But that doesn't mean much in terms of him getting his hands on it, given the receiver would have sold the BI to her.

kepar

Silver it is irrelevant the lenders have said that she cannot take the mortgage on. So if he stops paying, they will surely go for repossession. Very unfortunate but I cannot see a way out with all that equity in the property.

Somerset

kepar wrote: »

Silver it is irrelevant the lenders have said that she cannot take the mortgage on. So if he stops paying, they will surely go for repossession. Very unfortunate but I cannot see a way out with all that equity in the property.

He's not paying anyway. The OP's friend has been paying the mortgage in full for the last five years. There are no arrears. It's just a question of how much the OR will want for the BI, when, and if she's got the wherewithall to buy it.

RAS

Good advice from silver car.

Kev, your neighbour does not need to get her ex off the mortgage in order to sort this out.

Unfortunately, she will need some how or other to buy the Beneficial Interest from the OR. So for a start BI = roughly (the equity, less any early redemption penalties, less any cost of the sale (estate agents and solicitors) divided by two.

Since she has been paying the mortgage for the last 5 years, she could argue that his BI is less but since she failed to get the situation with the house sorted out as part of the divorce settlement she is more vulnerable.

She certainly need to pay interest until this is sorted out.

kepar

RAS wrote: »

Good advice from silver car.

Kev, your neighbour does not need to get her ex off the mortgage in order to sort this out.

Unfortunately, she will need some how or other to buy the Beneficial Interest from the OR. So for a start BI = roughly (the equity, less any early redemption penalties, less any cost of the sale (estate agents and solicitors) divided by two.

Since she has been paying the mortgage for the last 5 years, she could argue that his BI is less but since she failed to get the situation with the house sorted out as part of the divorce settlement she is more vulnerable.

She certainly need to pay interest until this is sorted out.

I Think this is the problem, she has no money to pay the BI, which could be £5000+.
If she could find the money I don't think they would be asking for help.

Rikki

Can i ask a quick question. What if the ex is on the mortgage but not on the title deeds and the ex goes bankrupt?


For the OP's problem. How long was the ex helping with mortgage before you took it over five years ago? I'm thinking you have earned a bigger percentage of the equity.