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Max Lowry
Max Lowry, Advocate
Category: Law
Satisfied Customers: 1457
Experience:  LLB, 10 years post qualification experience
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I was adjudged bankrupt in January 2013. At that time I owned

Customer Question

I was adjudged bankrupt in January 2013. At that time I owned two properties. One was my matrimonial home (a house) and the other was a buy to let flat. After the bankruptcy, the trustee in bankruptcy started receiving the rent for the buy to let property. However, he did not do anything about the matrimonial home until now. I recently received a letter from him advising me that he intends to sell my house and I should start looking for alternative accommodation for my family. Please note that I was discharged from bankruptcy in January 2014. And both properties are solely in my name. We have three young children aged 10, 8 and 2.
Here are my questions:
1. My wife and I run a business together and the mortgage for both properties has been paid from our joint income from the business. Can my wife therefore claim that she is a joint owner of the property and has an interest in the property. If yes, what does she need to do to register her claim?
2. When I bought the matrimonial home in 1999, I borrowed £35,000 from my parents. What can they do to ensure that they get their money back when the trustee sells the property?
Thank you.
Submitted: 3 years ago.
Category: Law
Expert:  Max Lowry replied 3 years ago.
Hi, welcome to the site. My name is ***** ***** I will help you with your question. With respect to question 1 your wife can indeed argue she has a beneficial interest in the property. On the basis the house in your sole name the trustee will consider that 100% of the beneficial interest belongs to him so your wife will need to demonstrate that she has a certain percentage interest which belongs to her. Once this is established, she can and a third party try to buy out the trustees share in the property to avoid it being sold. She will need to write to the trustee setting out that she has at least a 50% share (or some other percentage) on the basis of her mortgage payments, looking after children while you were at work, paying for improvements etc.. It is also possible to argue that it was always both your intentions that a certain percentage of the property was always hers - the trustee will however ask for evidence of this but it can be an oral agreement but then it is difficult to prove.
With respect to question 2, unless you can prove your parents had some kind of agreement with you that the money was going to be paid back to them upon sale of the house there is, I'm afraid limited options here. They could have registered a charge against the property if the money was going to be a loan to you to enable you to buy the house. If you can't prove it was a loan and instead it is a gift then the trustee will consider this sum and the rest of the beneficial interest belongs to him (subject to your wife's claim).