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b199
Starting Member
17 Posts |
 Posted - 10 January 2009 : 21:10:25
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| im considering going br we have a joint mortgage (where we live) poperty is only worth 130k mortgage is 126k is that right my wife would only have to pay 2k as she isnt going br. also we have got a joint mortgage on a buy to let ,again property is worth 100k but mortgage is 98k we have tried to sell both propertys but to no advail. can you give me some adive |
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Reviva UK
Advanced Member
United Kingdom
2452 Posts |
Posted - 10 January 2009 : 22:07:02
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Hi
you are correct in thinking that your wife would have the opportunity to purchase your beneficial interest from the official receiver for half of the equity.
You may consider that with the current housing trend that the equity would probably be completely gone in 4 - 8 weeks time.
Regarding the BTL property - more complicated because it is a joint mortgage ( actually may work in your favour) - the Official Receiver is not interested in bricks and mortar but assets that can be realised.
normally if the btl were in your name only the OR would take control, however because it is jointly owned it is possible that they may allow her to buy the BI for £212 ( inc legals)
Alternatively if you have documented evidence that the house is in negative equity you may elect to sell your BI to your wife prior to Br and clearly show the OR the papertrail afterwards.
Paul Johns
Assisted Bankruptcy Specialists
Reviva UK
Real People ..... Real Debt Solutions
www.revivauk.com |
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John
New Member
United Kingdom
73 Posts |
Posted - 10 January 2009 : 23:17:36
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Hi
I should also consider, re the BTL property, that the OR's trustee could well place a restriction on the property indefinitely. This means if years down the line equity is built up once again then the bankrupts share of the interest still vests with the OR & trustee. As the trustee's fees are not capped it is quite likely that the bankrupt will never actually realise equity from this property.
I have not seen any cases where BI in a neg equity and jointly mortgaged BTL property is offered to the non bankrupt. A long term restriction is more likely.
This does not happen so much with the marital home as the trustee has a 3 year time limit but with an investment property there is no such limit.
Paul
re the selling of BI on a neg equity property, prior to bankruptcy, by one joint mortgagee to another.
Have you seen cases of lenders permitting this recently? Most solicitors seem very cautious on this one too as they do not seem to understand the Insolvency aspect and fear repercussions from the OR at a later stage.
www.Bankruptcyhelp.org.uk
0800 078 9367 |
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Reviva UK
Advanced Member
United Kingdom
2452 Posts |
Posted - 10 January 2009 : 23:25:37
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Hi John
have seen a couple in the last 4 months where the situation was sorted out prior to Br.
You are correct though in that the solicitors seem to deag their feet as they are on uncertain teritory.
The bast plan always it to be absolutely transparant with all the dealings with the OR.
Provided that everything is properly valued and documented it should be OK
Paul Johns
Assisted Bankruptcy Specialists
Reviva UK
Real People ..... Real Debt Solutions
www.revivauk.com |
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pix1
Average Member
689 Posts |
Posted - 11 January 2009 : 08:53:27
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b199,
It looks like your wife could buy the BI in the family home property and this, by the way, might be better to be done after your bankruptcy order so as to be transparent to the OR. The price will probably have dropped into negative equity by the time the decision day comes as it will probably take the OR several months to deal with it.
Re what John has said about the BTL, it looks likely that the OR will keep an interest on this property until eventually sold, however long it takes. They will simply slap a restriction on it at the Land Registry. The slight problem for you is that if it is not repossessed you would, presumably, need to keep letting it out until there is positive equity and then sell it and let the OR realise any proceeds. If you keep letting it out AFTER your bankruptcy order but whilst there is still negative equity you would have been deemed to have been paying the mortgage on it and thus be liable to mortgage shortfall arrears from the mortgage company even though you previously went bankrupt. As your wife is NOT going bankrupt it would be good if there was a way to transfer the ownership to her before bankruptcy (assuming the OR, indeed, would not take a dim view of transferring ownership before BR?) so that you could not be hit for mortgage shortfall later.
Of course, even if this could be done, your wife could still be liable if the property is sold anytime in the next few years and there is a mortgage shortfall. One way or the other, you are lumbered with the BTL for a long time unless you can sell it at a loss and JOINTLY go bankrupt so that neither of you can be held liable for mortgage shortfall arrears. The advantage of this is that you could both draw a line under it simultaneously instead of your wife possibly having problems somewhere down the line. Who knows how far the market will drop - in 5 years the BTL might be £50,000 or more in negative equity and, even when sold, you would not see any proceeds of it! If your wife had any other debts these could go into bankruptcy, too.
There was a story on tv about a man who went down for £3 million BTL debts. A scary world has been created by messrs Brown and Blair.
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pix1
Average Member
689 Posts |
Posted - 11 January 2009 : 08:57:04
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b199,
One thing I missed in my reply is that if you both went BR I think someone else would have to buy the BI in the family home property. Unless you could yourselves, I don't know. |
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Reviva UK
Advanced Member
United Kingdom
2452 Posts |
Posted - 11 January 2009 : 09:06:40
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Hi Pix
to follow on regarding the Buy to Let side, we noiw have many clients without personal debts but large BTL portfolio's.
The houses have droped by 20% in value, the rental income hasn't changed and their fixed rates have finished.
This means that without equity they can't remortgage and now the repayments have jumped from 5.25% to 6.8%. Some people are needing to subsidise the mortgage each month by £400.
We are helping 1 person with 42 properties. 42 x £400 is serious each month
Paul Johns
Assisted Bankruptcy Specialists
Reviva UK
Real People ..... Real Debt Solutions
www.revivauk.com |
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b199
Starting Member
17 Posts |
Posted - 11 January 2009 : 11:02:08
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thankyou i have a rough idea off where i stand i think regarding the btl i have to get a current value on it . if it can be sold if only to pay mortgage i think that will be the route to go down as if its kept 7 yrs time it has to be sold as the mortgage comes to a end and as its an interest only mortgage the payment will be 98k and as you say if left and there is neg eq then this will force b r on wife side as there is no way of a remortgage on my side of it as ill be 68 and only a pension to live on .
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pix1
Average Member
689 Posts |
Posted - 11 January 2009 : 11:09:21
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| A lot depends on how your wife might feel about bankruptcy. Its not everyone's cup of tea. The thing that worries me is that there might be a big shortfall at some point in the future. |
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b199
Starting Member
17 Posts |
Posted - 11 January 2009 : 11:13:34
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sorry one more thing if the family home gained poss eq could the or then come for the house .
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im considering going br we have a joint mortgage
