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| kha |
Posted - 24 June 2009 : 21:08:06
Hi my father is bankrupt, the bankruptcy proceedings have progressed to the Lawyers appointed by the Trustee, I have agreed to buy my fathers share. At the moment I don't accept their finger in the air valuation (£275K), they don't accept my full valuation I submitted last year (£260k). They asked that I perform a joint valuation and that I be bound by the outcome of this. I agree to a joint valuation but I do not want to be bound by the outcome as the figure might be much higher than the market rate, can I refuse to be bound by the outcome? Each day property prices are dropping and I would like to take advantage of this. |
| 7 L A T E S T R E P L I E S (Newest First) |
| RHB |
Posted - 26 June 2009 : 07:30:01
You can say what you like, but the trustees will have to agree it. If they don't accept 260,oo I doubt they will accept 240,ooo. |
| kha |
Posted - 25 June 2009 : 17:55:21
Thanks RHB, I guess that rules out the bankruptcy path for me. I agree the Trustees get paid, but let's say the property is worth £250k - this leaves £84k in equity, 50% is my mothers share, less 50% my stake on my fathers share so £7.5k - the Trustee would get £34.5k this amount reduces every day as this recession continues, so it's in the Trustees interests to get this over and done with as quick as possible, if it goes to court it works in my favour as the process will take longer. I had the house valued at £260k in May 2008 and this was a full valuation, therefore on average property prices have dropped more than 15% in the year, so I am hopeful that the property should be valued at £240k or less, this would mean the Trustee gets £29.5k. If this drags on through court, as my lawyers pointed out, they would incur further legal costs upwards of £10k and also further drops in property price value. The question I ask is this, I have agreed to a joint valuation, the lawyers have asked that my father and I agree to be bound by this, am I under any obligation to accept this, or can I refuse to be bound, or at the very least can I refuse any offer that is say above £240k? Also can my father buy back his share if I or someone else give him the money, I'd prefer it if the property remained in his name. |
| RHB |
Posted - 25 June 2009 : 17:18:16
Thing is, the trustees get paid first, then the creditors so if there is equity in the property they won't be in a rush. Also, if you make yourself bankrupt you lose your stake in the property because that is an asset. |
| kha |
Posted - 25 June 2009 : 15:51:15
Hi Suzanne, many thanks for your reply. I appreciate what your saying, the fact of the matter is that house prices are dropping, and the longer this drags on the less the house is worth. I'm tempted to agree to be bound by the outcome of the valuation (they want both my father and and I to sign this) and if the outcome is not favourable, I will withdraw from the process of buying and then another family member (say my mother) can step in buy my fathers share? I did appoint solicitors and they made it clear that the Trustee would prefer to avoid court action, as it will cost them more. I mean if indeed it goes to court, all is not lost, as the Court from what I understand would prefer to not evict my family and will work to resolve the situation, my family are quite happy to buy back my fathers share, just not at the unrealistic prices the Trustee has put forward, if the matter does go to court, would I or say my mother if I withdraw be required to pay legal fees? (my mother is not working).
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| Suzanne |
Posted - 25 June 2009 : 14:51:59
Hi kha
You have to remember you don't have the upper hand here. The Trustee can just start possession proceedings and then sit on it for however long it takes to get the out come they want. There is sufficient equity in the property for them to push this further, and as they have to act in best interests of the creditors, and so realise the maximum possible from the property, they will do everything in their quite extensive power to get what they want.
Suzanne Stocker
Bankruptcy Manager
Jones Giles Ltd
www.jonesgiles.co.uk
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| kha |
Posted - 25 June 2009 : 08:46:21
In actual fairness, I'd prefer it if the property was bought by my father, I'm not sure if this is possible [I'm happy to raise the money for him]? I don't want my family evicted. My underdstanding is that the Trustee has 3 years from the moment the matter passed to the OR to 'use or lose' the assets in my fathers estate, so as such they have until September 09 to submit a possession order. I would imagine the Trustee is reluctant to do that since it will take at least 6 months for anything to transpire, cost them a further £10,000 in legal fees and property prices contine to decline. Personally I think the property is worth around £240k. The matter has been with the Trustees lawyers for almost a year so has cost the Trustee a huge amount in legal fees. The mortgage on the property is £166k, and is currently jointly owned by my mother and father (although his share is technically owned by the Trustee). Since I have also been paying towards the mortgage the Trustee has granted me a £15,000 stake in the property. Now I'm tempted to reply back saying I refuse to be bound by the outcome of the joint valuation, and also state that if they go to court, and try to recover their costs from me, then I'll file for bankruptcy and since they are aware that I have no assets, I'm hoping this will give me a strong bargaining position? |
| RHB |
Posted - 25 June 2009 : 07:28:49
They don't have to sell to you after all, so I suppose it depends on how much you want to buy it. Maybe suggest 270? |
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