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FamilyMan
Starting Member
6 Posts |
 Posted - 16 January 2009 : 16:02:48
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Hi All, can anyone advise whether they have had any dealings calculating the value of a Trustees Interest in a property. My issue relates to a trustee initially putting "Mortgage Redemption" on the calculation, then when we pointed out the actual redemption figure was higher than this and they had in fact used Mortgage Balance, they did a u turn and said it should be Balance not redemption ?? Our argument is unless the Property Interest Calculation is reasonable, in the current climate the house will have to be sold and then they would have to use redemption, so surely as that is the only alternative, redemption is the only figure we should accept. There is a difference of some £6500 in our case!
What is the experience of others have you seen balance or redemption used in these calculations ?? Any help greatly appreciated. Can't tell you how supportive all on here have been to date, brilliant! |
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John
New Member
United Kingdom
73 Posts |
Posted - 16 January 2009 : 16:34:12
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Hi
bit of a grey area.
The OR does not have to take into account any redemption penalty to determine equity.
However, as you rightly point out this seems strange on the basis that were the property sold through a forced sale the redemption penalty would, none the less, have to be paid before any equity were realised.
Redemption penalties last for various periods.
The question is, does the 3 year time limit during which the trustee must deal with your property go beyond the date that the redemption penalty clause in your mortgage becomes void?
If it does then the trustee could wait for the clause to lapse. The problem for the trustee here, of course, is the longer he waits the lower your property value is becoming in todays market.
In this situation, therefore, if the trustee applied to the court for a forced sale on the basis that you were willing to purchase the BI of the bankrupt only if the redemption penalty figure were applied, the likelihood is the judge would find in your favour. In the meantime the trustee is trying to get all that he can from you in agreeing to transfer the BI.
If you were to write to the trustee detailing that you are aware of the above, in a very polite manner, they may well back down on this issue.
So acknowledge he is perfectly within his rights to ignore the penalty, then explain the reality.
Hopefully common sense would prevail.
www.Bankruptcyhelp.org.uk
0800 078 9367 |
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Reviva UK
Advanced Member
United Kingdom
2452 Posts |
Posted - 16 January 2009 : 18:44:16
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For some reason if the trustee is the OR then they seem to take a black and white view and exclude the redemtion from the calculations.
If the trustee is an external Insolvency Prctitioner then they are likely as John has said work out when the redemption clause ends and take a commercial view.
Interestingly the largest early redemption I have ever seen was for £46,000.
Paul Johns
Assisted Bankruptcy Specialists
Reviva UK
Real People ..... Real Debt Solutions
www.revivauk.com |
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Redemption or Balance
