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| T O P I C R E V I E W |
| airborne |
Posted - 27 August 2008 : 18:58:58
if i am declared bankcrupt,then what happens to my wife?
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| 11 L A T E S T R E P L I E S (Newest First) |
| JulianDonnelly |
Posted - 28 August 2008 : 14:09:29
Great advice as always John :)
Julian Donnelly
Spokesperson for www.Bankruptcyhelp.org.uk
Don't forget the helpline on 0800 078 9367 |
| BankruptC |
Posted - 28 August 2008 : 09:36:52
Thanks for the full explanation John. No wonder I couldn't answer that one!
That makes it really clear.
CG. x |
| John |
Posted - 28 August 2008 : 01:02:54
Hi
it's probably easiest if you try and seperate in your minds the actions of the OR as a result of your bankruptcy from the potential future actions of the lender. Providing the mortgage continues to be paid then the secured mortgage is outside of, and therefore unaffected by, the single parties bankruptcy.
If you do not wish the property to be subjected to a forced sale then a sum approx equal to the Br's BI must be raised by the non BR, or a 3rd party, to pay to the OR who pays this sum to the creditors.
The mortgage lender is kept out of, and has no interest or part to play in, this scenario.
That is, both names will remain on the mortgage and both parties will remain equally responsible for future payments.However, that BI which was previously owned by the BR now belongs to the purchaser who's name will be added to, and the BR's removed from, the deeds (but not the mortgage - as secured borrowings are not included in BR). So the BR owns nothing but is still equally responsible for future mortgage payments together with the non bankrupt party.
We must assume that if the decision has been made to purchase the BR's BI then both the BR and non BR parties, and 3rd party if one exists, expect the future repayments to be affordable.
Therefore, as the property has not been subject to a forced sale, if at a later date circumstances prevail whereby the property is in jeopardy due to the repayments becoming unaffordable (perhaps a job loss) then once 3 monthly mortgage payments have been missed the lender will now become involved and usually file for repossession.
If this happens and there is a shortfall from the sale which cannot be met by other means of payment by the 2 mortgagee's then the mortgage lender could file for the BR of both parties.
The previous BR therefore going BR again.
www.Bankruptcyhelp.org.uk
0800 078 9367 |
| BankruptC |
Posted - 27 August 2008 : 22:58:26
Hi Mark,
I have to admit I'm not sure what would happen to a FUTURE shortfall if your wife bought the BI. I'm sure John or another expert will help with this one.
John, does the fact she's bought the BI mean she would from that point be solely responsible for the mortgage from then on? How does it work?
As we're not going down that route, I haven't asked about it (till now!)
CG. x |
| John |
Posted - 27 August 2008 : 22:50:53
Hi Maz
Don't know where you read that, but CG is correct.
Joint and several means just that.
You are jointly AND severally liable. If both parties signed the original agreement then the whole debt falls to the non bankrupt.
www.Bankruptcyhelp.org.uk
0800 078 9367 |
| BankruptC |
Posted - 27 August 2008 : 22:46:17
Hi Maz,
I've just copied this from a debt site too.
'Joint and Several Liability is when you take out and sign a joint credit agreement with another person. This means that both parties are liable for the repayments of the money borrowed.
This includes;
Secured and Unsecured loans
Mortgage
Joint bank accounts
Joint Tenancy
Council Tax
If you have taken out a joint account with another person, this does not mean you are only responsible for half of the money owed. As far as a lender is concerned, both parties are equally liable for the full amount borrowed.
If one party is made bankrupt, they will be released from the legal responsibility to repay the debt, leaving the other person fully liable to make the repayments.'
Very odd indeed. Hopefully an expert will clear it up for us.
CG. x |
| BankruptC |
Posted - 27 August 2008 : 22:41:26
Sorry to confuse you Mark,
I was just giving examples of 'joint and several' debts. I'm not sure of your situation, but you are right, secured debts are not covered by BR.
Now we mention it though, in my case our house was in negative equity and we knew that if we handed the keys back to the mortgage company, then went BR, the shortfall WOULD be captured in the BR because it is in effect now unsecured (no house to secure it on). If we'd done this (or had the house repossessed) and only my hubby had gone BR and not me, I would have been solely responsible for the mortgage shortfall.
Hope that helps and hasn't made it even more confusing for you!!  (Just ignore the second bit if it makes no sense and doesn't apply to you!)
CG. x |
| Maz |
Posted - 27 August 2008 : 22:41:04
I have just been on another website and found the following:-
"Filing together eliminates the separate debts of you and your spouse and all the jointly-held marital debts. Filing alone leaves the non-bankrupt spouse still liable for his or her share of joint debts, but wipes out the spouse's separate debts and his/her share of the joint debts."
Am very confused now, should I ask at the Court what is correct?
Maz
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| BankruptC |
Posted - 27 August 2008 : 22:13:09
Hi Mark and Maz,
If debts are 'joint and several', which mortgages, joint loans, joint overdrafts etc are, the person who is not BR becomes liable for the full debt.
CG. x |
| Maz |
Posted - 27 August 2008 : 22:05:25
Hi, I thought if you had joint debts and you go bankrupt you other half is only liable for half of the joint loan? is that not right? |
| John |
Posted - 27 August 2008 : 19:51:46
Hi airborne
any joint debts would become her liability.
If you have no joint debts (secured or unsecured) then your bankruptcy has no effect on your wife.
www.Bankruptcyhelp.org.uk
0800 078 9367 |
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