www.iva.co.uk

I've tried other bankruptcy forums but I cant seem to find an answer. So I hope someone will be able to help.



I am thinking of declaring myself bankrupt. I have £30,000 in unsecured debt. All in my name. I live with my partner and have done for 1 and a half years. The mortgage on the house is in her name only and comes out of her account. She has lived there for 12 years and bought her ex husband out around 3 years ago. I do pay toward household costs. But that is all. She wants to keep our finances separate and who can blame her! We don't have any kind of credit, loans etc in joint names. Should my wife see a solicitor to see where she stands? It seems like the opposite of divorce as I am NOT claiming interest in the house.

I am worried about the Official Receiver thinking I have "beneficial interest" in the home. I want to make a clean start as we are expecting a baby this year, there is already my stepdaughter who is 10 who lives with us. It seems doing research into this that it is up to the OR's discretion whether or not we have beneficial interest. Obviously I'd like to know one way or the other before declaring myself bankrupt.

Any help or advice would be appreciated.

Hi. As you have discovered it is at the discretion of the OR whether he wants, or it is worthwhile, to pursue a claim for beneficial interest. It is very difficult to prove such an interest and, in the circumstances you describe, unlikely. BUT --- stranger things do happen !

I cannot give you a definitive answer, because there isn't one.

Hi I presume that as you have only lived there for 18 months the property has never been in your name, let me give you two scenarios,

1) The OR after your bankruptcy discovers a loan for £20000 which was used for property improvement taken out a year ago. Upon investigation he sees you paid for an extension over the garage for an extra bedroom which an expert says you have increased the value of the property by £30000. The OR could argue that the increase in property valuation is yours and that you now have an interest which he wants for the benefit of your creditors

2) The OR discovers that instead of building an extension you put in a swimming pool in the back garden which costs a similar amount. However a property expert states that you have not increased the value of the property if anything you have retracted its value therefore your interest in the property in nothing even though you put in £20000

As the property is not in your name the proof lies with the OR to prove that you have an interest, many will tell you that you develop an interest by contributing towards the mortgage if that were correct many private landlords would be gradually losing ownership of their properties to their tenants,

The rule in bankruptcy is you swap your assets for your debts, your assets not the assets of your wife

Hi Banquo

If you click on the link below ask your question you will have a reply from the horses mouth normally in five days

insolvency.enquiryline@insolvency.gsi.gov.uk

This is not an area of advice forum members should give as we are not proficient in bankruptcy details nor have the experiences of an OR.

The link given will provide you with formal professional guidance.