BRO/ House sale

wackijacki

Hi, first post, looking for advice please, My husband looks like he will be subject to a BRO resulting from him repaying some family debts shortly before his bankruptcy, they have now asked those family members to repay the funds even though there is proof it was a legit loan/repayment situation, agreements and bank statements as evidence, I understand now this is preferential treatment, Is there a way to appeal this, as it is going to significantly and negatively impact those members?

Also half of the house now belongs to Official receiver if we sold it would I still get my share ( probably only about 2/3K) so that we could move into rented accommodation- deposit/ removal costs etc? We have 2 young children and only my husband is currently in full time employment and he currently pays an IPO .


Thank you.

dojoman

wackijacki wrote: »

Hi, first post, looking for advice please, My husband looks like he will be subject to a BRO resulting from him repaying some family debts shortly before his bankruptcy, they have now asked those family members to repay the funds even though there is proof it was a legit loan/repayment situation, agreements and bank statements as evidence, I understand now this is preferential treatment, Is there a way to appeal this, as it is going to significantly and negatively impact those members? No you are not allowed to give preference to anyone, including family members.

Also half of the house now belongs to Official receiver if we sold it would I still get my share ( probably only about 2/3K) so that we could move into rented accommodation- deposit/ removal costs etc? We have 2 young children and only my husband is currently in full time employment and he currently pays an IPO .


Thank you.

Cannot answer your second question.

alastairq

Also half of the house now belongs to Official receiver if we sold it would I still get my share ( probably only about 2/3K) so that we could move into rented accommodation- deposit/ removal costs etc? We have 2 young children and only my husband is currently in full time employment and he currently pays an IPO

Difficult to answer as some assumptions would have to be made [or indeed, have already been made?]

Has your OH achieved Automatic Discharge yet? { ie, 12 months since date-of-petition?}

Has the Official Receiver already decided what percentage of any equity in the house your OH has?

[or, is there an assumption it will be 50/50? WHich may not be the case..the OR might calculate you have a higher percentage of the equity. ]

Has the OR [or the IP] actually applied for a Charge Order on the property? [yet?]

Given the cash figures you quoted, it would appear there isn't much equity in the property [ an assumption]...so a CO would be the way the OR goes...but be aware, there is also Statutory Interest added to the value of the CO...currently 8% per annum....

If the house is sold, yes, you would get your share of the equity...after costs, etc have been deducted. How much that would be, would depend a lot on the questions above.

wackijacki

Thank you for those responses, We are basically screwed I know, due to a mixture of poor judgement, ignorance and bad advice!

Is there an appeal template letter anywhere, I understand we have made silly choices but I can't sleep knowing they will suffer because of this. Thank you x

alastairq

Again, I must make some assumptions.

Firstly, appeal against what?

Are you referring to the family repaying to the Bankrutpcy estate because of the 'preferential treatment' rules?

WHich are enshrined in Law.

The object of bankruptcy is, to treat all creditors equitably. This much you now realise. [Yet, the 'rules' were there for all to see?]

As I see it, there are two options.

[1] The family members concerned, when the OR demands the repayment of monies, could state quite clearly, they have not the means to pay back said monies. The OR's response, in practice, may well depend on the amounts involved. Although compulsion via the Courts is an option.[since it is, effectively, the Court which is making the demands...the OR is the Court's Officer], if the sums are relatively small, the OR simply may not bother.

[2],The family members repay those amounts, to the BAnkruptcy estate....as required by the Court [the OR]. They then become a creditor in bankruptcy, and eventually will be given their percentage share of the value of the BR estate.

Thus, something may come back to them.

However, there really isn't anything to prevent your OH from making payments to the family, subsequently.......although the monies would have to be found from elsewhere within your OH's SOA. This would not be conducted on any sort of formal basis.
The OR does not monitor every penny spent subsequently [although they have the powers to do so]....

Why do you yourself not repay the family?

debt_doctor

Hi,


The OR will not generally start recovery (court action) against the recipient of a preference unless the action could generate at least £5000 for the estate.
So, if the family member says "we have no money" then the OR will decide what to do based upon the above. They may 'ask' a few times though and they will outline the actions they MAY take. (a bit like those debt collection companies we all know so well!)
DD