Bankruptcy Home - Charging Order

AMSE123

Hello,

I had a bankruptcy petition served by a creditor in July 2019 and was made bankrupt in June 2020. In September 2019, my previous mortgagee (on a prior property) applied a charging order to my current home which otherwise had no mortgage (the amount of the charging order far exceeds the home value). 

Since bankruptcy, I have received nothing indicating what anyone's intentions are with the home. I was discharged after one year. Currently awaiting an annulment hearing as we believe the creditor debt not due and bankruptcy order wrongfully made. Have not been able to get legal advice due to circumstances. 3 years has just now passed and still I have heard nothing as the receiver seems to be waiting for the annulment hearing that is yet to take place; I do not want to ask and alert anyone to potential issue. 

Does the property re-vest or does the prior charging order mean they can still get the property? Do I now have to insure the property or is that still with the Official Receiver? 

Any help would be greatly appreciated; I have not been able to sleep properly since as keep worrying about waking up to something that will leave my family and I homeless.

Minkym00

If the property has a charge that exceeds its CURRENT value then it is not an asset and selling it will not benefit the bankruptcy estate. The property should have been re-vested by now in any case as the OR has three years in which to deal with it. After 3 years the insolvency legislation doesn’t allow them to claim it. 

Write to the OR and ask what’s happening. Do they have your current address?

AMSE123

Minkym00 said:

If the property has a charge that exceeds its CURRENT value then it is not an asset and selling it will not benefit the bankruptcy estate. The property should have been re-vested by now in any case as the OR has three years in which to deal with it. After 3 years the insolvency legislation doesn’t allow them to claim it. 

Write to the OR and ask what’s happening. Do they have your current address?

Thank you for your reply. Yes, the charging order exceeds the value by a lot. Wouldn't payment to that creditor i.e. by enforcement of the charge benefit the estate as that creditor is part of the estate? 

  

We thought the same re: revesting however, it would have occurred a few weeks ago and the Land Registry still lists the bankruptcy restrictions with "No disposition of the registered estate is to be registered until the trustee in bankruptcy of the property of the bankrupt is registered as proprietor of the registered estate". 

The OR has the address, it is our home and the address that was on the original bankruptcy order. Throughout this time we only received the initial bankruptcy questionnaire from them (by email) and nothing after that except occasional queries as to the estate initially and updates on the annulment application since. They didn't advise when they sold other assets. We are worried that if we approach them it may bring it to their attention and they may attempt to take adverse action whilst we do not have any legal assistance and aren't in a position to dispute it if the property issue comes to light. 

Thanks, again!

Minkym00

That creditor is secured though. The only reason the OR would force a sale is if, after debts secured on the house are settled, there is a reasonable amount to pay towards the debts fees of the bankruptcy.  

Here is the section of the legislation that covers this Insolvency Act 1986 (legislation.gov.uk). Assuming you made them aware of the property at the start of your bankruptcy then the OR (or the trustee) has 3 years in which to deal with it. (If you didn't they have three years from when they became aware of it). Just because there is an annulment hearing pending doesn't affect this.