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Alex J.
Alex J., Solicitor
Category: Law
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Experience:  Solicitors 2 years plus PQE
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I have a property with a mortgage, the asset in the property

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I have a property with a mortgage, the asset in the property equates to about £50,000. Due to some unsecured personal debt I incurred a few years back due to the loss of a business, I would like advise on putting the asset into a Family Trust so that the £50,000 is protected from creditors. Can you tell whether this is possible and whether the asset will be totally protected from the creditors and some idea of the cost to do this?
Many thanks
Jane
Submitted: 1 year ago.
Category: Law
Expert:  Alex J. replied 1 year ago.
Hi, Thank you for your question and welcome. My name is ***** ***** I will assist you. You could transfer the property to a trust however you would have to avoid going bankrupt for at least 6 years in order to ensure that the transaction cannot be challenged by your creditors. There are provisions under the Insolvency Act 1986 that prevent a debtor form disposing of their assets to avoid a credit - specifcally S339 and S.340 (Transaction at an undervalue and preferences) - potentially your trustee in bankruptcy (if you were made bankrupt) could un wind the transaction if you went bankrupt within 6 years. Also in order to transfer the property to a trust you would need the consent of the mortgage company. I look forward to hearing from you Kind regards AJ
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Customer: replied 1 year ago.
Hi AJ,
can you tell me whether it is usual for the mortgage company to grant permission, if so and I put the property into trust is it guaranteed that creditors could not gain access to the assets? I don't have any reason to believe that I would be likely to go bankrupt in the next 6 years, however could an unsecured creditor force me to become bankrupt?Jane

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