Bankruptcy and mortgage

[Deleted User]

hi i recently went bankrupt and me and my ex husband have a mortgage between us which i want my name removed from as i no longer live there. he wants to sign an agreement which says he will continue to pay the mortgage until it can be transferred to his name , im not happy with this as i went bankrupt to remove my name from it completely and get out of the house as it is in such negative equity

does anyone know where i stand with this?

thanks

Mouse1812

The mortgage company will not allow your name to be removed, but don't worry about that.

Bankruptcy only deals with unsecurred debts, so the mortgage is excluded from your bankruptcy.

If the property is ever sold - even years in the future after your discharge, any shortfall will become unsecurred and will then fall into your past bankruptcy.

This means you will never have to pay anything, just do not sign any agreements (or a remortgage) because these could make you liable again.

mattannar

Questions for Mouse: You sem to be well up on this area.

Until the house is sold the OP's name will stay on the mortgage, so say in 6 years time the OP wants to buy another property she will have to declare the property and mortgage

If the husband can afford the mortgage and carries an paying, in time the property goes back into equity and is sold, what right has the OP to any share of the excess?
I appreciate these questions do not have to apply in this case, they are more of a general thought.

Mouse1812

Good questions, and you have correctly identified two big problems.

I would suggest the husband has the bigger incentive to sort this due to your second observation and he would be well advised to sort sooner rather than later.

On the face of it she would be entitled to 50% of the equity and it would require a Court Order to alter this.

Not even the courts can not force the mortgage company to remover her name from the mortgage, only they and they alone can choose to do that. So the husband needs show he can afford it by himself and perhaps buy her out.

[Deleted User]

the problem here is i went bankrupt for the sole purpose of removing my name from this mortgage. I didn't have any other debts at all. now it feels like i went bankrupt for absolutely no reason? My husband wants me to sign an agreement that I will not try to move back in to the property and that he will be legally responsible for the house and then our divorce can be finalised. If he had come up with this agreement before i went bankrupt it would have saved me a lot of hassle. is it in my best interest to sign this agreement? i cannot envisage a day when he will be able to afford to cover the mortgage himself on his salary so my name could be left indefinitely on a mortgage with huge negative equity and I havent lived in it for 3 years. anyone any ideas?

tigerfeet2006

Who gave you advice on going BR?

minic

Hi Emmafairygirl,

Did you list any debts on your bankruptcy forms? I'm astounded that your bankruptcy petition could get approved by the court if you don't have any unsecured debts and the property you have with your ex hasn't been repossessed leaving a shortfall. What did the OR say when you had your interview?

As others have said already bankruptcy will not remove your name from the mortgage. It is up to the mortgage company whether they will remove your name although from what you have said it does seem unlikely if your ex could not get the same mortgage based on his income alone.

If you have no debts then unfortunately think you have been wrongly advised that BR would be a solution for you. I think it would be in your interest to see a specialist bankruptcy solicitor to see how you could go about getting the bankruptcy annulled (other more knowlegable) members may know where to start with this), but you will likely have OR costs to pay. When were you declared bankrupt?

Best of luck getting it sorted.

M

[Deleted User]

thanks. i was declared bankrupt in nov 2012 thinking that this would enable me to get me decree absolute and remove my name from the mortgage, i had a credit card bill of £400 which i also put on my form. at court i was asked little or no questions she jsut looked at my mortgage outstanding and the meagre £400 bill and granted me the bankruptcy order. now i am left in a really bad financial situation needlessly. it is very frustrating

meer53

Who has been advising you about your divorce and bankruptcy ?

I removed my ex's name from my mortgage but i had to remortgage in my sole name to do this and a transfer of equity form was required which he had to agree to sign. This cost me an extra £300. I took advice from a financial advisor first.

[Deleted User]

we can't remortgage in his sole name as he cant afford it

[Deleted User]

ive spoken to solicitors, financial advisors, CAB