Beneficial Interest...

desperatedad

Hi all,

I have been considering applying for bankruptcy for some time now and have a few questions regarding 'beneficial interest'...

I won't go into my full situation again here, suffice to say that I am on a DMP with the CCCS at present and they fully support the notion.

I have no equity in my property. It was valued a few months back at £215,000-£220,000 and it is mortgaged for £235,000 due to our original mortgage and a secured loan (and being stung with a PPP, but thats a whole other story!).

We are really hoping to hold on to our proprty as we love it where we live and there is a good school at the end of the road which would be convenient when my little girl eventually reaches 4yrs, and we have until now never missed a payment on either the mortgage or secured loan.

Am I right in saying that as there is no equity in the property that there is no beneficial interest?

I've heard that the official receiver can lodge his interest in any future equity in the property and as its jointly mortgaged, take half the equity some point in the future, is this true?

I've also heard that it is possible to buy back your beneficil interest. Is this something I can do myself as the bankruptee or does this have to be done by a third party, family member or friend?

Is there a time limit on when you can apply to essentially buy out the official receivers interest in the property?

Is there a calculated amount thats required for this to happen based on property value, etc?

What I was basically hoping was that I would apply for bankruptcy and then very soon after make an offer to the OR to buy out the beneficial interest back into my/our name for a small nominal amount (my parents have offered to help me out here with £1000 if it would resolve this issue and allow me to get back on with my life - good old mum and dad ). I appreciate this is just my own personal musings, but are there any obvious flaws in my plan?

Are there any other future implcations of this that I should be aware of?

Any feedback on the above would be greatly appreciated.

Regards
DD

JulesJay

Hi DD

Just wanted to say welcome to the forum

Although I cannot offer advice to you on your current circumstances there will be someone along soon to help.

Jules x

desperatedad

Hi Jules,

Thanks, I've made a few posts before and this is such a great place to get advice and support. If you do a search for my previous posts and look at my first pos you can see what a complete wreck I was and how through my other posts I become much more positive and start taking control. All pretty much thanks to this forum and the kind words and support of its fellow members

I'm still trying to get it all together and have been undecided what to do long term for a while, but I'm getting there, I just like to have all my facts straight before I commit myself to something now!

Cheers
DD

Richard_S

desperatedad wrote: »

Hi all,

I have been considering applying for bankruptcy for some time now and have a few questions regarding 'beneficial interest'...

I won't go into my full situation again here, suffice to say that I am on a DMP with the CCCS at present and they fully support the notion.

I have no equity in my property. It was valued a few months back at £215,000-£220,000 and it is mortgaged for £235,000 due to our original mortgage and a secured loan (and being stung with a PPP, but thats a whole other story!).

We are really hoping to hold on to our proprty as we love it where we live and there is a good school at the end of the road which would be convenient when my little girl eventually reaches 4yrs, and we have until now never missed a payment on either the mortgage or secured loan.

Am I right in saying that as there is no equity in the property that there is no beneficial interest? That's right.

I've heard that the official receiver can lodge his interest in any future equity in the property and as its jointly mortgaged, take half the equity some point in the future, is this true?Yes he/she can and this has caught a lot of people out over the years. The O.T/Trustee now has only three years to exercise his right but rather than take the risk you can purchase the O.R's B.I for a nominal fee of £1 plus the O.R's legal fees, approx £225.

I've also heard that it is possible to buy back your beneficil interest. Is this something I can do myself as the bankruptee or does this have to be done by a third party, family member or friend? A third party can buy the O.R's B.I if it's positive but given that it's only worth a £1, you can buy it yourself. The third party is usually a non bankrupt spouse or partner or a friend or relative.

Is there a time limit on when you can apply to essentially buy out the official receivers interest in the property? I think it has to be done before you're discharged but I'm not certain about that.

Is there a calculated amount thats required for this to happen based on property value, etc?There is but it doesn't apply in your case because of the negative equity.

What I was basically hoping was that I would apply for bankruptcy and then very soon after make an offer to the OR to buy out the beneficial interest back into my/our name for a small nominal amount (my parents have offered to help me out here with £1000 if it would resolve this issue and allow me to get back on with my life - good old mum and dad ). I appreciate this is just my own personal musings, but are there any obvious flaws in my plan?You won't need your parents £1,000 just a good old "quid" plus legal fees.

Are there any other future implcations of this that I should be aware of?The only thing I can think of is that the O.R may not see the secured loan payments as part of the mortgage and this would complicate things with your Income & Expenditure A/C if the monthly payments were large.

Any feedback on the above would be greatly appreciated.

Regards
DD

Hi D.D,

Apologies for the quick post; oh the curse of work.

I know you're with CCCS so you've obviously taken advice but I just wanted to try my pro forma introduction to new posters::D

Your first port of call should be to contact one of the Debt Charities; see links below. Their services are free; they have no vested interest to serve; their advisors are professionally trained and the advice they give will be objective and in your best interests only. CCCS operate a system of telephone appointments that are designed to be flexible and don’t require you to attend an office based interview. At the CAB you will need to make an appointment with a specialist Financial Advisor; other advisors may not have the specialist knowledge you’ll need.

http://www.cccs.co.uk/

http://www.nationaldebtline.co.uk/

http://www.citizensadvice.org.uk/index.htm

If you’re advised that bankruptcy is the most suitable solution to your financial problems then we can offer the best support and anecdotal advice that you’ll find anywhere on the Web.

For more specific advice and support, in an environment that is managed by people with first hand experience of bankruptcy, and moderated to ensure that no deliberately inflammatory or abusive posts are made then please visit:

http://bankruptcysupportersclub.co.uk/default.aspx

Just remember, as desperate as you may feel at the moment, we have all experienced what you are going through at the moment and with the right support and advice things will improve. It’s not an easy route to take but it is a route that will put you back in control of your life rather than just reacting to events.

Best regards

Richard

desperatedad

Thanks for that Richard,

Wow, £1, I think even I can stretch to that!

Thats put my mind at ease a touch, though the whole bankuptcy thing still scares the hell out of me.

Cheers
DD