Beneficial interest query

Marsbar73

Hi

I need to try some advice with regards to Ex’s bankruptcy & me trying to purchase his beneficial interest in the property.

We are not amicable at all & our separation caused me a lot of mental anguish & this is bringing my anxiety back. We separated in 2014 & divorced in 2017. He has not made any payments to the mortgage since he left in 2014. He pays CM but nothing to mortgage. He is still joint on mortgage with me.

He has been made bankrupt in 2017 by HMRC for what I believe is £30k approx. I believe that they are taking money from his wages.

I received a letter from Insolvency people in Nov asking if I could buy his beneficial interest for £125k (there is a fair bit of equity in the property). Not sure where people think you have this kind of money lying around!!!!

I called them & spoke to someone as I’m very worried- I explained my current situation - he doesn’t live here, we are divorced, have a child, what he pays. The guy told me to supply all the evidence I can to prove this - which I did.

I supplied the insolvency people with lots of evidence & they have sent another letter back in December with regards to making an offer/purchasing Ex’s beneficial interest in the house at approx £50000 so they dropped it. They’ve said in email to me - I can make an offer on this based on my circumstances.

Firstly I do not have this sum of money (but I am going to speak to my parents) & secondly I need to understand what will the process be if I make an offer to insolvency. Will he be able to still demand 50% of profit from a sale ? (When & if the house is sold) How do I go about ensuring that if an offers accepted by the insolvency that I will then have 100% ownership/monetary value of the house. The insolvency people say title deed isn’t passed on to the person who’s paid his beneficial interest but the bankrupt will not be able to gain financially out of it as I will have 100% beneficial interest. I need to have this information secured or some legal documentation as I don’t want to proceed with an offer unless I know all the facts, as I am effectively paying his bloody tax debt off!!!

I am currently in no position to remortgage on my own or with my new partner as my credit score is poor (thanks to Ex!) So I’m going to ask my parents. But this still means as far as I understand that he will still be on title deeds & mortgage until I can remortgage.

Please can you someone let me know or give me any advice.

Thanks
Xx

debt_doctor

Hi,

You are correct that he will remain on the title deeds and on the mortgage.
Who ever buys the interest will need to ensure that it is registered at the land registry that the purchaser now owns the (presumed 50%) interest of the ex partner.
You will not need the permission of the ex for this as the trustee now owns his share, and it is for the trustee to deal with it.

Good luck.

DD

Marsbar73

Thank you DD...So I can ask insolvency people to add info to title deeds that I own 100% beneficial interest? & he will definitely not be able to get anything if the house is sold??

He wanted me to pay him £100k to buy him out & he’d pay insolvency & take rest!!! which I would not be able to do!! I’d be happy to just deal with insolvency people & make an offer if I can but it’ll just be enough to cover his debt as he won’t get a penny more out of me. I already have enough debt that I accrued whilst we were together because he was out if work!!

I’m looking to try & improve my credit rating but this could be a slow process. Ideally I don’t want him on mortgage but currently can’t remortgage, so he’d have to stay on it.

Xbigman

debt doctor is correct, your ex has no interest in the property anymore. It is the OR that has the interest now. They have, in effect, offered to sell you 135k of equity for 50k. That 50k figure itself is negotiable. An offer of 40k+ is usually enough but they have already given a big discount so they may try for the full 50k. You should speak to a solicitor with knowledge of bankruptcy law and conveyancing. With these sorts of sums at stake legal advice is essential.

Your Ex appears to have asked you to give him 100k in cash and he will then buy back his interest from the OR. He is taking the P. For one thing he will have to declare receipt of the money and the OR will then seize it to cover his debts. Not declaring receipt of the money would be illegal. He sounds like a right chancer. Avoid.



Darren

Mouse007

I think this could actually be a good deal for you, a very good deal.

Your ex has lost, as correctly pointed out above, his share of the equity to the OR. You suggest this is worth over £100k but the OR will accept half or less of this. Presumably to pay £30k to HMRC and pocket the balance in fees, because that's all they need to raise to clear his debts (?).

Instead of there being a balance to return to your ex (which would happen if all debts and costs have been recovered), you get 100% beneficial ownership.

It would be great if your parents could help. They could buy the beneficial interest and keep it safe or gift it on, always consider options.

Either way, you can effectively buy out your ex now for half value and never have to account to him again.

I’d be busting a gut to pull that deal off.

silvercar

The OR is working on the principal that the equity is split 50/50. Often in divorce cases the equity split would be in favour of the person that stays in the marital home and houses the children. So it may be worth having that argument first.

Whereas there is the opportunity to acquire the equity, you are still tied financially by a joint mortgage and the house deeds. This is not ideal in terms of of credit records.