Avoiding home repossession due to family business debts.

Tommygunn

Granted, this is going on in Italy with my immediate Italian family but I would still like to hear how it would work out in the UK and hopefully I can use that to investigate further to help my family out.

The story is thus.
Many years ago, before the 2008/9 crash my wife and her brother put their names to documents for their father's building business/es (silent partners, tax purposes, shares, something along those lines). Of course, now, everything has gone belly up and the business/es have gone bust leaving all three with the responsibility of the debt that remains with the bank. Their father has already had his house taken by the bank and apparently my brother in law has also received a repossession notice today.

So far, my wife and I have not received anything.

The circumstances of my wife and I are that we are completely financially separate and it is her name on the 'deeds', so to speak. I'm also farely certain that the bank we have the mortgage with is not the bank that has the business debt on it's books. I suspect my father in law had his mortgage with the same bank which is why his home went so quickly.

What can we do to thwart any possible repossession?

Below is a list of some of the things that spring to mind, but I don't know how realistic they are.

1) Sell the property and get out of dodge.
2) Gift it to a family member/friend.
3) Sell to a family member/friend.
4) Sign it into my name.
5) Go to court and plead - pay off debt.
6) Bancruptcy - pay off debt.

Any help would greatly appreciated.

Thanks,
Tom.

coolcait

It it's happening in Italy, you need to get advice about how it works in Italy, I'm afraid.

There are differences in the way that bankruptcy works in Scotland compared to how it works in England. Never mind anywhere else.

The one bit of advice which holds true wherever you are is speak to people who know how things work in the place where you live.

If you're talking about a situation where you live in the UK, but might be affected by the fact that family members are facing bankruptcy in Italy, then you're talking about cross-border jurisdiction.

That definitely needs specialist advice. I don't know if National Debtline and others can help you with that, but they might be able to point you towards people who can help.

dancingfairy

Well in England it would depend on the set up of the company - sole trader or partnership or Ltd company etc.
If it was a Ltd company in England then directors are not normally liable unless they have given personal guarantees.
You need to try and understand the structure of the company and what, if any liability lies with your partner.
Df

dancingfairy

If she owes money in Italy then presumably they could come for her over here but it's not clear whether she does, and if so how much.
If she went bankrupt over here then gifting a house/ signing it over or selling for significantly less than true value could cause more problems. I believe an official receiver can reverse transactions or ask for the money to be repaid.
Selling at market value is fine but then obviously you'd have to find somewhere to live. If you were thinking about selling to family or friends theyd have to get a buy to let mortgage and fulfill all the legal obligations of being a landlord, sort the tax aspect out etc etc. They'd also be unlikely to get a mortgage in the circumstances - ie to rent back to previous owner and compounded by them being a relative.
I think really you need to find out how much she owes, what her guarantees are/ were/ how much she has to pay back. You can't get anywhere sensible until you have an idea of the figures.
Df