Selling house, joint owners, charging order on one owner - how is equity defined?

Sponz

Hi,

My other half was made bankrupt in Dec.  A couple of weeks prior to that 2 final charging orders were placed on the house.  We are joint owners but the charging orders are linked just to my husband.  Official receiver has confirmed they have no interest in the property.  We remortgage the property a couple of years ago and the monies were used to fund my husband's business which is in administration. This was suppose to be a loan but none of the monies were paid back by his company.  Since July 2020 I have solely paid all the mortgage, including the extra mortgage that went into his company.  This was all run passed the official receiver along with all the paperwork to prove it. 

Now, my issue is when I come to sell (I would like to sell ASAP) what happens to the charging orders as my husband took all his equity out for his business and I've been paying for everything ever since.  If the house is sold for say example 300k, then I have done the maths and my husband has zero equity due to the remortgage and me paying everything.  It would have to reach 400k for those with a charging order to get anything although there is no way it would go for that based on the property.  What I want to know if how to I get this all defined?  What I don't want is to sell the house and then I'm having to argue it's 100% my equity and it's a complete nightmare.  Any help what be great as I have spoken to some solicitors and I just get fluff that I can find on the internet.  

Thanks,
Spon

Minkym00

As the property is jointly owned, when it sells his 50% beneficial interest will go towards the mortgage and settling his charging orders. If the equity doesn’t settle them completely then any shortfall will be his unsecured liability. 

Your 50% equity is safe as the charging orders are in his name only. 

Sponz

Minkym00 said:

As the property is jointly owned, when it sells his 50% beneficial interest will go towards the mortgage and settling his charging orders. If the equity doesn’t settle them completely then any shortfall will be his unsecured liability. 

Your 50% equity is safe as the charging orders are in his name only. 

That’s the thing. I don’t believe he has 50% interest as he relinquished that when we took the 2nd mortgage and he put it into his company. That company never paid that mortgage back, although it was agreed it would, as it went into liquidation and I have personally been paying that and the other original mortgage for over 18 months now with no assistance from him. Does anyone have any experience of this as both are repayment mortgage that I am paying g off 100% on my own.

Keep_pedalling

Sponz said:

Minkym00 said:

As the property is jointly owned, when it sells his 50% beneficial interest will go towards the mortgage and settling his charging orders. If the equity doesn’t settle them completely then any shortfall will be his unsecured liability. 

Your 50% equity is safe as the charging orders are in his name only. 

That’s the thing. I don’t believe he has 50% interest as he relinquished that when we took the 2nd mortgage and he put it into his company. That company never paid that mortgage back, although it was agreed it would, as it went into liquidation and I have personally been paying that and the other original mortgage for over 18 months now with no assistance from him. Does anyone have any experience of this as both are repayment mortgage that I am paying g off 100% on my own.

Do you own the property as joint tenants or tenants in common? If the later did you have a deed of trust drawn up showing your share of the house as larger than his?

A joint tenancy or TiC with no DoT will be treated as 50/50 ownership.

Minkym00

The second mortgage was in joint names and therefore was invested by you both into your partner’s company. 

You are also jointly and severally liable for the second mortgage repayments. So, unless any of the investment into his company was subject to a legal agreement at the time, I can’t see your claim for >50% having any merit I’m afraid. 

Sponz

Hi, further to this I have consulted with a property solicitor who agrees I can get something in place to indicate the equity split in the property as it's clear that the 2nd remortgage was made purely to benefit my husband's business and that I did not benefit from it at all.  I will keep you posted.