WHAT PROPERTY CAN I KEEP IN BANKRUPTCY?
Typical examples of property that
you can keep: a car, if subject to finance
and with little equity clothes household goods
and furniture appliances your principal home,
if and only if there is little or no equity
personal effects jewellery professional tools
income from social security, disability, public
assistance, unemployment some pension funds,
child support and maintenanc.
Please note that in all of the above cases
property can be retained where it is the subject
of a Charge or is purchased on hire purchase
(for example a car) and if there is no or
little equity in the property. In addition,
it should also be noted that if any of the
above listed items are of particular value,
for example valuable jewellery or furniture
then they will properly fall into the bankruptcy.
In relation to matrimonial homes, it should
be stressed that even if there is substantial
equity in the property, the Trustee in bankruptcy
cannot ordinarily repossess the property within
one year of the making a Bankruptcy Order.
This will not however prevent a charge holder
(i.e. the mortgagee) commencing repossession
proceedings. In many cases property will be
co-owned by the debtor’s spouse. The Trustee
in bankruptcy will ordinarily approach the
debtor’s spouse in order to ask whether he
or she wishes to purchase the interest of
the debtor’s failing which, possession proceedings
will ordinarily commence after the one year
time limit as set out above. Neither the bankruptcy
nor an IVA will prevent a lender from repossessing
your home if it is subject to a mortgage charge.
During the course of the life of the interim
Order, it is possible that the Courts will
prevent repossession proceedings from continuing.
An IVA may be a better way forward as ????????
will provide a greater recovery for creditors
than would have been the position in a bankruptcy.
They will also usually make provision such
that the mortgage lender is paid in full.
In the case of a bankruptcy, whilst you may
be able to remain in possession of the matrimonial
home for a minimum of one year, after that
year has expired, possession proceedings are
likely unless either there is no equity in
the property or a third party such as a spouse
could buy out the Trustee in Bankruptcy’s
interest i.e. the debtor’s equity in the property.
Following a discussion of the difference between
a bankruptcy and IVA in relation to a matrimonial
property is tape stops here. |
