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Max Lowry
Max Lowry, Advocate
Category: Bankruptcy Law
Satisfied Customers: 1457
Experience:  LLB, 10 years post qualification experience
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Good morning Would you mind explaining if a third party buys

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Good morning
Would you mind explaining if a third party buys the BI off of a OR of a property what rights they have over it. i.e. can they force a sale? Can they stop a sale? Can they stop a 2nd charge going on it? Can they stop me getting extra funding? Once sold do they get all the equity or are buying/selling costs included/excluded? can a limit be put on it? Thank you
Hello again, I'm so sorry for not getting back to you earlier. I've been in Court all day. If you don't mind waiting a little longer I will be delighted to answer your question a little later on.

Kind regards
Customer: replied 6 years ago.

No worries whenever your free - thanks for getting back to me


 

Once again, I apologise for not replying sooner. Thanks for your question. OK, there's a lot of questions here. If a third party buys the beneficial interest off the OR that person will have an interest in the proceeds of sale only. You will still hold legal title. The third party beneficial owner is entitled to live in and maintain the property and pay council tax etc., he she will also be entitled to live there. He/she could rent out their share the property.
I'm afraid it is possible for the beneficial owner to force a sale of the property but they will need a court order to do this if you do not agree. However, as legal owner you will still need to pay the mortgage. They would also be able to stop a sale.
They could stop a second charge going on because this will erode thier beneficial interest.
They could stop you obtaining funding if you are using the property as security - again, this will erode their beneficial interest.
If the property is sold they will receive the value of the beneficial interest. Therefore, if it is a soley owned property and the third party purchases the OR's beneficial interest in it (100%) when the property is sold they will be entitled to 100% share of the proceeds of sale. If their share is only a percentage of the beneficial interest they will get only a percentage of the proceeds of sale. You could put a limit on it but they would need to agree to that limit - if they are buying the interest for a certain price they will probably want to ensure they are getting a deal they are happy with.
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