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my dp going bankrupt, will I lose my house?

(25 Posts)
Quadrophenia Wed 15-Oct-08 10:32:41

We are in the process of splitting up and he has agreed to move out of the family home and rent a flat. One of the only ways in which he will be able to do this is by declaring himself bankrupt as he pays a large amount of money on arrangement to crdeitors each month. I intend to stay here with the children but am worrie that if he does make himself bankrupt I will lose the house, it is in joint names.
He has just gone to seek advice this morning but I was wondering if anyone can shed any light on here as I'm worried that he won't leave if he can't do it.TIA

QuiteQuiet Wed 15-Oct-08 10:35:37

You shall have to put house into your name.

i think?

ilove Wed 15-Oct-08 10:36:17

If it is in joint names it will be classed as part of his assets, sorry

Can you buy him out?

Quadrophenia Wed 15-Oct-08 10:36:53

no can't buy him out

Quadrophenia Wed 15-Oct-08 10:37:46

btw he won't do it if it will leave me homeless, it just means he might not leave and we can't stay together anymore sad

Quadrophenia Wed 15-Oct-08 11:26:11

can he just sign the house over to me without me having to buy himout?

QuintessenceOfFrankenShadow Wed 15-Oct-08 11:30:05

Quadrophenia, he can, but there has to be a timescale, but I dont know how long it is. 1 year, two years? Otherwise most people going bankrupt would just sign off all their assets first. He should have done this long ago if it was in the cards. Can you afford the mortgage on your own?

katz Wed 15-Oct-08 11:31:49

i don't think he'll be allowed to give away his assets (the house) and then declare himself bankrupt.

ruddynorah Wed 15-Oct-08 11:32:23

have you enough income to take on a mortgage to cover your outstanding joint mortgage? your lender won't just sign it over to your name unless you can show you can make the repayments.

could you do it if you extended the term? what term are you on now and how old ish are you?

otherwise yes you would lose the house to repay the debt on it as he would be declaring that he can't afford the debt.

FAQ Wed 15-Oct-08 11:37:36

ruddynorah - sometimes the bank won't even sign it over to you if you can afford the repayments.

I have a friend who's exH left 4 1/2yrs ago - she's been paying the mortgage on the house since then as he fucked off and didn't pay a penny and the bank won't let sign it over to her name shock! (she has a regular income, good job etc etc, not missed payment)

LadyLauraStandish Wed 15-Oct-08 11:39:09

The transfer needs to be more more than 5 years before the bankruptcy - sorry.

If there is minimal or no equity you might be able to buy his interest from the trustee for a nominal sum. Otherwise his beneficial interest is half the equity in the property.

ruddynorah Wed 15-Oct-08 11:39:46

yes it would be a brand new mortgage application etc, but the starting point is if the OP could actually take on the mortgage. my point is that if not, she could look at an extended term to make it more affordable.

Freckle Wed 15-Oct-08 11:40:51

If he declares himself bankrupt, the receiver will be interested in his share of any equity. However, if you and the children are living there, you could probably stave off the enforced sale of the property for about a year.

It really depends on how much equity there is in the property. Can you disclose this? They will only be entitled to his share and, if that does not amount to much (particularly in the current economic climate where it might be very difficult to sell the house), the receiver may decide to ignore that asset.

deepinlaundry Wed 15-Oct-08 11:42:22

If there is equity in house, it will have to be sold. You won't be thrown out- you are given up to a year to sort something out. If there is no equity, generally official reciever not interested. It doesn't make any difference whether joint names or not- the official reciever will deem that there was a beneficial interest anyway. They will go back through finances to establish things like this. Your best hope is that there is liitle equity, don't start transferring names on deeds as this will look bad on you . Hope things get sorted- it may be a relief in the end.

LadyLauraStandish Wed 15-Oct-08 11:44:48

The Official Reciver (or other trustee in bankruptcy) HAS to deal with the asset - they can't ignore it!!!

ruddynorah Wed 15-Oct-08 11:44:56

i wouldn't have thought the joint names would mean the receiver would only apply for half the equity, unless the house is signed in tenants in common, which would be unlikely.

Freckle Wed 15-Oct-08 11:46:30

If the house is in joint names, the receiver will require the house to be sold and the equity split between the parties on a 50/50 basis if joint tenants or in accordance with any trust deed if tenants in common. The OP would receive her share and the receiver would take her partner's share.

LadyLauraStandish Wed 15-Oct-08 11:47:05

In jointly owned properties the starting point is 50% of the equity unless either party can prove a different percentage.

LadyLauraStandish Wed 15-Oct-08 11:50:13

Jointly owned properties do not have to be sold - a third party can purchase the beneficial interest of the bankrupt. If this is impossible then the property will be sold or a charge taken over it.

CarGirl Wed 15-Oct-08 11:54:18

Can you claim a larger share as maintenance for the children as he presumably won't be able to give any? Sounds like you need to speak to a specialist solicitor, or can you but that clause that the house cannot be sold until the youngest is 18?

LadyLauraStandish Wed 15-Oct-08 11:56:25

Found the leaflet you need.

What will happen to my home?

Quadrophenia Wed 15-Oct-08 11:58:08

thanks for your input, in the current climate think we have about 15 grand equity, his debt is for quite a bit more.

deepinlaundry Wed 15-Oct-08 12:02:05

what I meant was that if there is no equity, the official reciever is not interested in forcing a sale- a fee is paid to have the house transferred into anothers name. Sorry if I didn't make that clear.

Lauriefairycake Wed 15-Oct-08 12:07:35

Ok, if you only have 15k equity you may be able to keep it as it would like be declared as half yours, half his. Because of the selling fees and the fact that prices are falling this could be a very good thing for you as you may be allowed to buy him out for very little (I know someone who bought out there partner for £1)

However you can't just transfer it into your name as the official receiver can reverse it.

The OR would decide whether the property had to be sold but even if so you have a full year where your interests are paramount (and you could sell yourself) before your dh's creditors interests become paramount.

I would wait til prices fell a bit more, get 3 realistic valuations for sale, dh goes bankrupt, OR probably agree to have no interest in property.

Good luck smile

lots of answer to beneficial interest questions on the forum www.debtquestions.co.uk

LadyLauraStandish Wed 15-Oct-08 12:08:09

Yes, deepinlaundry - if there is negative equity the beneficial interest can be sold for £1 (plus legal costs, obviously).

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