ex partner bankruptcy threat

frak

Hi all,
not really a debt free wannabe question but thats as close as it comes.
My girlfriend's ex partner is threatening her with bankruptcy. They have have a mortgage and a join loan secured on the house for about 20k i think. He has now decided to be really awkward since he has found out about us and is threatening to go bankrupt as i he says he cant meet the payments any more, although he has done for last 9 months. The house is up for sale but she is currently living in it with her 18 year old daughter. He says he is not paying anymore when there is no benefit for him especially when i am living there, which incidentally i am not. Her income no way meets the full amount required and so relies on him contributing.
I have offered to help out but she gets upset about that saying she would feel indebted to me but i would rather that than her lose out on the house and clearing the debts with sale of the house. Can he really threaten bankruptcy and what would this mean to her and the house and the debt ?
thanks in advance

poppy10_2

frak wrote: »

HThe house is up for sale but she is currently living in it with her 18 year old daughter. He says he is not paying anymore when there is no benefit for him especially when i am living there, which incidentally i am not.

Sounds fair enough. Why should he pay? Is your girlfriend paying the rent on his new place?

CLAPTON

Well, yes he can go bankrupt if his financial affairs are such that he is insolent. Depending upon his circumstances this may or may not be in his best interests.
I can't judge whether is a bad tempered threat or not.

If he went bankrupt then your GF will have the opportunity of buying his share of the house but from what you say she can't afford that.
If they have joint debts then the creditors will chase her for the full amount of the debts. The house would eventually be repossessed so it must better for both of them to sell the house themselves.. usually one gets less for a forced sale.

She needs to see a solicitor urgently to sort out the splitting of their financial affairs.. the house and also any joint debts.

kittiej

Just sounds like sour grapes to me tbh.

She should call his bluff and tell him since she can't afford to pay the mortgage she has decided to stop paying it.

See what he says then, you should be able to gauge whether he's just blowing hot air or not.

kittiej

Clapton just a question.

If the GF would have the opportunity to buy the ex's share does it mean that the OP could step in and help out then by way of joint mortgage?

Not that I'm saying that's what they should do, I just wondered.

silvercar

There is a big difference between going bankrupt and not paying the mortgage. He could just stop paying the mortgage. It would take 4 months before the lender started to get tough, longer if regular communication with the mortgage company was made and some effort made to make some sort of repayments. At that point the lender may go for a repossession hearing, though it could be much longer.

When the house is sold (either private sale or repossession) the mortgage arrears will be taken along with repayment of the capital mortgage amount.

The boyfriend would get less equity paid out to him and a screwed credit record. Doubt he would gain much if the house is being sold.

If he went bankrupt, any equity in the house would be given to the Official receiver to pay his creditors, so he would see less money. He can't go bankrupt without taking professional advice and he can't go bankrupt if he is solvent.

If the GF would have the opportunity to buy the ex's share does it mean that the OP could step in and help out then by way of joint mortgage?

yes, if the GF and OP wanted to. That would mean that their finances are then linked.

kittiej

Wouldn't that be a poke in the eye lol!

frak

Thanks for the replies guys, thats a big help. Just one more small question.
How would we define financially solvent, is it just the ability to meet your financial obligations without going further into debt.
I dont believe he will go for bankruptcy in fact i dont think he can. He is just doing it to cause trouble for her with me, which so far he is succeeding at. All of this advice though gives me a chance to show that she is in control and can do something about it.
Poppy no she isnt paying his rent, of course not, but he did choose to leave her after playing psychological and emotional games with her due to his insecurities. He even asked me if am going to look after her, stupid bloody question, like i need to report to him. I will help her out financially if she needs and/or accepts, but i am not getting involved in buying into the house and mortgage.
once again thanks everyone

kittiej

Glad you feel a bit better now.

I didn't expect you would want to buy into the house, it was just my own curiosity that's all.

One of those " What would happen if they did so and so" moment

silvercar

How would we define financially solvent,

interesting question!

is it just the ability to meet your financial obligations without going further into debt.

Agree, though people do deliberately increase their debt (eg take out a car loan, house mortgage or business loan) without considering themselves insolvent.

I would say its not being able to meet your financial obligations, without taking on debt for the sole purpose of repaying existing debt.

Broken_hearted

He can go bankrupt if he wishes too, there are very little consequences nowadays if he did. Best thing is for the house to sell quickly.