"Bankrupt by Association"

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DDZ3D
DDZ3D Posts: 2 Newbie
in Bankruptcy & living with it
Hello. After breaking up with my ex several years ago, he was declared bankrupt along some of his family members who were involved in the same family business (this business was nothing to do with me). As a result of this, and because we lived together (not married), the liquidation company wrote to me and told me they could force me to sell my house in order to pay off some of their/his debts. As a result of this and being frightened to death i would lose my home, i believed them, and remortgaged my house to pay them several thousand pounds. I went to an independent mortgage advisor who told me i was "bankrupt by association" with him and as such, wouldn't be able to get a 'high street mortgage', so he sold me a high interest mortgage for people with bad credit rating, which i consequently struggled to pay. When i was totally broke and on my last nerve and penny, i went to my bank and explained my situation, and they told me i had been "well and truly done" and that there is no such thing as "Bankrupt by Association". I wondered if it would be possible to claim back for the money i had to add to my mortgage and also claim back for being mis-sold a high interest mortgage. Has anyone else had something similar happen to them?

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  • Mouse007
    Mouse007 Posts: 1,062 Forumite
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    Who were the "liquidation company"? Do you still have the correspondence?

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  • antrobus
    antrobus Posts: 17,386 Forumite
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    DDZ3D wrote: »
    Hello. After breaking up with my ex several years ago, he was declared bankrupt along some of his family members who were involved in the same family business (this business was nothing to do with me). As a result of this, and because we lived together (not married), the liquidation company wrote to me and told me they could force me to sell my house in order to pay off some of their/his debts. As a result of this and being frightened to death i would lose my home, i believed them, and remortgaged my house to pay them several thousand pounds....

    You were right to believe them. Assuming that the property was indeed at least part owned by your ex, and that there was equity in the house, realising that equity for the benefit of sreditors would be inevitable.
    DDZ3D wrote: »
    ...I went to an independent mortgage advisor who told me i was "bankrupt by association" with him and as such, wouldn't be able to get a 'high street mortgage', so he sold me a high interest mortgage for people with bad credit rating, which i consequently struggled to pay. When i was totally broke and on my last nerve and penny, i went to my bank and explained my situation, and they told me i had been "well and truly done" and that there is no such thing as "Bankrupt by Association". I wondered if it would be possible to claim back for the money i had to add to my mortgage and also claim back for being mis-sold a high interest mortgage. Has anyone else had something similar happen to them?

    Bankrupt by association is just a phrase.

    You can indeed make a complaint to the independent mortgage advisor that you were mis-sold a high interest mortgage.

    You cannot reclaim the money you had to add to the mortgage. That money is what you paid to buy your ex-partner's share of the house.
  • Mouse007
    Mouse007 Posts: 1,062 Forumite
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    antrobus wrote: »
    You cannot reclaim the money you had to add to the mortgage. That money is what you paid to buy your ex-partner's share of the house.

    She refered to it as her house, we don't know if it was jointly owned.

    BBC WatchDog “if you are struggling with an unfair parking charge do get in touch”


    Please email your PCN story to watchdog@bbc.co.uk they want to hear about it.
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  • antrobus
    antrobus Posts: 17,386 Forumite
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    Mouse007 wrote: »
    She refered to it as her house, we don't know if it was jointly owned.

    That might be why I wrote;

    Assuming that the property was indeed at least part owned by your ex,
  • DDZ3D
    DDZ3D Posts: 2 Newbie
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    Hello, yes at the time we (unfortunately) had a mortgage together. I was forced to re-mortgage as i was threatened by the liquidation company that they could make me sell up if i didn't pay them money. I don't have any company names for the bankruptcy. I do remember the independent mortgage advisor's name and the name of the high interest mortgage company.
  • nomoneytoday
    nomoneytoday Posts: 4,866 Forumite
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    Sounds to me that you had a joint mortgage.
    The other half went bust, so you had to buy the beneficial interest.
    The Financial advisor sorted you out with a remortgage to cover this.


    Whether the rate of the mortgage was right or wrong would depend on your circumstances at the time.
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