Advice please

hegitodu

Hi,
My partner will not discuss his debt problem with me and keeps telling me that he is 'dealing with it'. However, I have seen a letter from HRMC stating that a court date in July has been arranged for him to be declared bankrupt owing £27k. I don't know what the implications are and how it will affect me and my family (we have 2 teenager children at secondary school). We have a mortgage in joint names but have around £160k equity and have a joint bank account plus his business account. I am not sure what will happen if he is declared bankrupt. Will the accounts be frozen? Will we need to sell the house? will it affect my credit rating?
He will not admit to having a problem and will not talk to me about it, so wondered if anyone could tell what happens next.
Thanks

mwarby

if he's declared bankrupt

- yes your joint accounts will likely be frozen, although you would become liable for any joint debt(the full amount not just your share, the phrase used is generally joint and severally liable)

- with 160k of equity its very likey they will seek to repossess (unless you have money to clear all the debts, fees and bankruptcy charges)

- as yiu have joint accounts yes your credit history will be affected, because anyone pulling your history will see the connected person(your husband) and will pull his history too and jse it while accessing whether to give you credit

to me the following strike me as options

- remortgage to cover the hmrc debt

- sell other assets to cover hmrc debt including moving to smaller home

- an IVA(although pleas be aware that repayments are NOT fixed in an IVA, IVAs have fees which may apply given your equity and chances of paying all of the debts, and they will seek to release the equity your home)

Before exploring any of those options in depth though you need to get a fuller picture of your position known as a statement of affairs, you can post that here and we will chip in with our thoughts and or you can speak to a debt advisor although be aware they often make money(couple of thousand often times) by selling you an IVA, CAB or stepchange are generally good options

Note its not going to be a good idea to sort out the HMRC by remortgaging or other painful means, only to discover there is much more other debts to be addressed or that you can't really afford the new loan

this is a good tool for building your statement of affairs https://www.stoozing.com/soa.php

mwarby

regarding repossession - they have 3 years to do this, given the current housing market it's likely that they won't be acting very quickly on this, they are more likely to wait a bit for things to settle down.

It's also possible to buy out the ORs interest in the property(is give the OR enough money that its not worth them selling it), but given equity and debt(that we know about so far) it's going to be tens of thousands to go down that route