BI in property - What is 'Next Step'?

Richard_S

rog2 wrote: »

But why should my wife be made to suffer for something over which she had no control whatsoever?

Rog,

There is a legal precedent that refers to somebody in your wife's position, I was reading some lengthy cases relating to spouses who were unknowingly exposed to the risks of their spouse's business activity. It wasn't relevant to our situation so I didn't make a note of it but a good solicitor should have it at their fingertips. If it comes back to me during the day I'll post the details.

Rich

rog2

Richard_S wrote: »

Rog,

There is a legal precedent that refers to somebody in your wife's position, I was reading some lengthy cases relating to spouses who were unknowingly exposed to the risks of their spouse's business activity. It wasn't relevant to our situation so I didn't make a note of it but a good solicitor should have it at their fingertips. If it comes back to me during the day I'll post the details.

Rich

That would be great Rich - Thanks.:beer:

Richard_S

rog2 wrote: »

Thank you Rich - I really appreciate your post as it is based on first hand experience.

I have been a bit low (understatement) today and haven't been on much as I have been 'brooding', but I can definitely see some positive suggestions in your post.

I do have a 30 year old son, who lives with us. He is on a fairly low income, but we will look into the possibility of him buying my BI.

I don't think that I would get a mortgage at the moment - not having been in paid employment for the best part of a year, and not even receiving jobseekers allowance. I have started a job this week, but it is only temporary and will probably be finished in another two or three weeks. I am, of course, still looking for more permanent employment, but going on recent experience nothing can be guaranteed.

However, I am heartened by your experience - I will be seeking legal advice.

The trustee has given me until the end of May to respond, so hopefully this will give me enough time to explore all possibilities.

Thanks again Rich.

Rog,

This is starting to look better; I'd forgotten you had an adult son still at home. Your son has a B.I in the property, the extent of that B.I is of course open to the usual "horse trading" but again a good solicitor should be able to maximise this interest on the basis of previous cases.

You certainly won't get a mortgage at the moment but you will once you start working and what the O.R/T is looking for is a proposal for realising your B.I. You've made getting a full time permanent job a lot easier by taking on a part-time post, if you get a good reference from that job it should convince any future perspective employer that despite having been self employed you still know how to be a good employee. That was one of the big hurdles I had to overcome, the length of time we had run our own businesses put some employers off, thinking I wouldn't be prepared to accept direction from others.

What is even more positive is that if both your wife and son have clean credit records then raising a mortgage of £70k (and falling) on a property that's worth approximately £150-£160k shouldn't be too difficult. I realise that your wife is due to lose her job shortly but it's far easier for a younger person to find employment than an older one.

That legal precedent I mentioned in my former post might even be a European Directive, I just can't bl***y well remember where I read it.

I can well understand you feeling resentful yesterday, there have been times when I could gladly have used the metaphorical "knife that was being twisted" to slit the throats of some of our detractors.

Hope you're feeling brighter today,

Rich

rog2

Richard_S wrote: »

Hope you're feeling brighter today

Feeling brighter by the minute - Thanks.:beer:

Mike_St_Helens

Looking much brighter !

rog2

Mike_St_Helens wrote: »

Looking much brighter !

Cheers Mike - I see you're 'doing the rounds' early today. :beer:

Richard_S

Hi Rog,

I remembered and found the notes, it's called "The principle of equity of exoneration". Unfortunately, I don't think it applies to your situation either, it's to protect a spouse where the other has raised money against the family home to finance a business. I've included a link because there are other useful articles and it makes the point that some European Legislation has impacted, if not changed the bankruptcy laws in this country. I should have looked for the information before mentioning it and I apologise for that.

http://www.sghlaw.com/insolvency/articles/BankruptcyTheMatrimonialHomeFeb2004.pdf

Obviously it doesn't affect the chances of you being able to reduce your B.I and ultimately raise the money that will allow you to keep your home.

Rich

rog2

Thanks Rich - I had already seen this document, when I was declared BR, but had not studied it thoroughly. I have now downloaded it, as I can see more relevance to my current situation than I did back in October.
I will study it, carefully, over the next couple of days.

Sooty0404

Mike_St_Helens wrote: »

Ive vaguely heard about the charge on the house thing... Would you be happy if thats the stance they took?

Hi Rog

Sorry to hear about your situation. In this case the OR is in the same position you would be if you and your wife split up. One of you could force the other to sell the house to release the proceeds.
They do not see that your wife is being made to suffer as she will receive her full share of the net equity (although we all know the opposite is true).
If you let them take a charge over the property you will almost certainly regret it. If they apply statutory interest at 8% on the figures you are suggesting it will be a KILLER.
8% on £70k is £5600 so after the first year your debt will be £75,600. Interest on this figure is £6048 so after Year 2 you are over the £80k mark and rising. With house prices rising at approximately 5% per annum, and assuming they continue to do so your equity, or more importantly your wife's equity will be eaten away before you know it.
Remember one of my first posts where my brother borrowed £40k and ended up owing £100k 9 years later.
You have to get the OR out of your life NOW. With the amont of equity in your property the loan to value aspect is your secret weapon. Your son/wife could walk into any Building Society and get a Self Cert mortgage easily. Go for an interest only mortgage for now to keep the payments down if you have to. Extending the mortgage period may also help to keep things affordable.
Once you are rid of the OR you only have to deal with the lender if things go wrong and they are usually far more reasonable. Plus it would add at least a year to your 'breathing space' if they decided to get you out. You also then have the opportunity to sell and downsize if neccessary.
If your wife refuses to consent to the OR's request to vacate he will have to evict her. This will be both costly and time consuming (and he knows it).
His job is to realise your assets for the best price possible in the shortest space of time so start off by offering him £50k. Its my guess you won't have to do too much negotiating before you reach agreement. Then get your wife to refinance in her name and you are left with 1 house + 1 mortgage + 1 lender - a far easier situation to handle in your circumstances.
You have to remove the Sword of Damocles (aka the OR) from over your head and the sooner the better. Good Luck.

Jane_East_Yorks

Sooty,

You sweep me off my feet sometimes with your faultless rational logic and poetic eloquence. You've made all Rog's problems seem as simple as you did mine.

Jane xx