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Situation –
A trust was created by will to include 3 trustees (a mother(the widow) and her two children (a brother and sister). They are also all executorsto the will.
As a result 2 properties are now held by all 3 as tenants incommon. The mother holding a half share in each and the children, each, a quartershare in both properties.
Property One – the house formerly owed jointly by the motherand their now deceases father. There is no mortgage and the property isfreehold. The house has been on the market for sale for the last 3 years. Itremains the mother’s intention to sell. As previously stated it is now owned byall 3 as tenants in common with the shares as described.
Property Two – a house purchased 3 years ago by the motherand father as tenants in common with an interest only mortgage. The mortgagecovers 66% of the value and the remaining 34% is therefore available as equity.The caoital is due to be repaid in 6 years and mortgage interest payments arebeing maintained by the mother. It is due to be repaid All 3 now are now tenantsin common and share as previously described. There is no negative equity and itis freehold.
Property Three – a house purchased 3 years ago by the sonand his wife. The mortgage covered 75% of the value and was jointly owned. Theydivorced shortly after purchase. The son was self-employed at the time but isnow unemployed. The mortgage is being partly paid for by the DWP and the shortfallis accruing as arrears. No payments are being made by his former wife (who isemployed). The house has been for sale for the past 3 years and is still up forsale. As part of the financial agreementthe former wife is to pay back a sum of money to the mother from the proceedsof sale (should it sell). There has been interest in the house but no salesecured and the property now needs further work (for which there is no money).
The son has accrued additional unsecured debts and has enteredagreements to pay a nominal sum each month to creditors. Due to another changeof circumstance he is not able to continue effectively servicing his debts andcontinue accruing mortgage arrears.
Question ?
He is considering petitioning for bankruptcy. Would there bea right time to do this? Would the Official receiver also be able to force asale of not only of his former matrimonial home but also any of the otherproperties in which he now has shares as a tenant in common. Unless some ‘protection’is afforded by the fact that it is held in trust.
Advice gratefully received
A trust was created by will to include 3 trustees (a mother(the widow) and her two children (a brother and sister). They are also all executorsto the will.
As a result 2 properties are now held by all 3 as tenants incommon. The mother holding a half share in each and the children, each, a quartershare in both properties.
Property One – the house formerly owed jointly by the motherand their now deceases father. There is no mortgage and the property isfreehold. The house has been on the market for sale for the last 3 years. Itremains the mother’s intention to sell. As previously stated it is now owned byall 3 as tenants in common with the shares as described.
Property Two – a house purchased 3 years ago by the motherand father as tenants in common with an interest only mortgage. The mortgagecovers 66% of the value and the remaining 34% is therefore available as equity.The caoital is due to be repaid in 6 years and mortgage interest payments arebeing maintained by the mother. It is due to be repaid All 3 now are now tenantsin common and share as previously described. There is no negative equity and itis freehold.
Property Three – a house purchased 3 years ago by the sonand his wife. The mortgage covered 75% of the value and was jointly owned. Theydivorced shortly after purchase. The son was self-employed at the time but isnow unemployed. The mortgage is being partly paid for by the DWP and the shortfallis accruing as arrears. No payments are being made by his former wife (who isemployed). The house has been for sale for the past 3 years and is still up forsale. As part of the financial agreementthe former wife is to pay back a sum of money to the mother from the proceedsof sale (should it sell). There has been interest in the house but no salesecured and the property now needs further work (for which there is no money).
The son has accrued additional unsecured debts and has enteredagreements to pay a nominal sum each month to creditors. Due to another changeof circumstance he is not able to continue effectively servicing his debts andcontinue accruing mortgage arrears.
Question ?
He is considering petitioning for bankruptcy. Would there bea right time to do this? Would the Official receiver also be able to force asale of not only of his former matrimonial home but also any of the otherproperties in which he now has shares as a tenant in common. Unless some ‘protection’is afforded by the fact that it is held in trust.
Advice gratefully received
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