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 Hi I have 2 houses, one I used to live in

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T O P I C    R E V I E W
hayd Posted - 10 January 2009 : 02:10:53
Hi I have 2 houses, one I used to live in as my family home, and one which I let out. My question is if I go bankrupt will the OR take both of these houses even though they are in negative equity. Both are now let out which covers the mortgages. If not my brother would buy the benefical interest. can you please tell me how this works. I will give you a example of one house:
Mortgage 115k, charge 35k. House value 135k. would my brother need to get a mortgage ect, please tell me how this would work. I am very worried, as I need to keep these houses
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JulianDonnelly Posted - 11 January 2009 : 15:57:01
Hi Hayd and welcome to the forum.

Secured lending is exepmt from BR. Your beneficial interest does need to be realised for the benefit of your creditors.

Under the 2002 Enterprise Act, the OR/Trustee has 3 years to deal with a residential poperty. Therefore, given the state of the market (if the property is in negative equity), it is more than likely the OR/Trustee will sell your BI for a nominal sum of £1 + costs (circa £211). In the case of an investment property, there is no time limit so they can enter a restriction over the property and re-visit it at any point in the future (once it has equity again) and force you to remortgage to release this for the benefit of your creditors.

Julian Donnelly
Spokesperson for www.Bankruptcyhelp.org.uk
Don't forget the helpline on 0800 078 9367

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