Your presiding trustee can make the decision to put your property on the market if they decide that it is the only measure they can use to meaningfully repay the debts included in your bankruptcy. You might be required to part with:
- Your equity in any property you have a stake in- you stake of a house after all your secured loan payments have been made in full.
- Legal sovereignty over your home.
If you are the sole owner of your property, then your beneficial interest and sovereignty will be passed over to your presiding trustee during bankruptcy. This will prevent you from selling your home independently or taking any of the sale cash for yourself.
Once this has occurred, a Bankruptcy Restriction Notice will be added to your homes reference on the Land Registry in order to make your new situation clear.
If you currently co-own a property with another party, then your beneficial interest will still be handed over into the hands of your trustee. Your home’s reference on the Land Registry will have a “Form J Restriction” placed onto it, which will entail:
- You will be vulnerable to your property being sold as the court can empower the trustee to assume ownership of your beneficial interest.
- Your trustee will be alerted of all activity and parties associated with your property, so it is impossible to embark on selling it without the court knowing.
Preventing the sale of your property
You might be able to slow down the process of selling your home or stop it altogether in cases where:
- Your beneficial interest has a re-sale value of under £1,000.
- Your beneficial interest can be sold off to an associated party, such as your partner.
- You require time to find an alternate residence for your children and/or partner to stay in- this can delay the sale of your property for up to 12 months.
Tenants in rented accommodation
If you currently live in rented accommodation, then usually your tenancy will not be affected by going bankrupt unless you are in a position where you are in arrears with your monthly rent repayments or your tenancy contract specifically identifies that you need to vacate the residence in the event that you go bankrupt.
You should ask your landlord about your rental arrangement and evaluate your original contract in order to ascertain whether you are at risk of being evicted for going bankrupt.