Questions and Info relating to Property Issues inc, Charging Orders and Repossession

Moderators: TalbotWoods, JaneClack

By Germ
#294023 Hi all. I have joined the forum on my sisters behalf as she is worried about leaving any trace of her id. Reasons for which will become apparent.

My sister divorced a few years ago. She was left with an apartment in Turkey which is fully paid for (although still waiting for the title deeds) and considerable debt consisting of loans and various credit cards. This was manageable at the the time. Even to the point that she obtained a mortgage with her new boyfriend to buy a property here in the UK. The UK property is a shared ownership scheme. With the downturn of the economy in recent years, they do not believe the UK property holds any equity. The Turkish property may be worth enough to cover her debts.
She has since ended up in a position where she cannot afford the repayments on the loan and cards and they have all been passed to debt collecters. She buried her head in the sand and has only filled me in on the state of things when after ignoring the calls on her phone, a debt collecter has started calling her workplace.
She now realises she can't hide from this any longer but I'm worried about how she plans to tackle this.
She is under the impression that she will not lose her UK property in bankruptcy as there is no equity, it is a shared mortgage with the building company 70%-30% (i think) and also her boyfriend is on the mortgage and he doesn't intend on getting involved.
As far as the Turkish asset is concerned, she is under the impression that as there is no UK loan for the property and it is outside the EU, she can simply not mention it in the procceedings.
Any thoughts on this scenario are welcomed.
Last edited by Germ on Fri Apr 06, 2012 11:33 am, edited 1 time in total.
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By JaneClack
#294043 Well if she did not mention it she would be lying, wouldn't she? All assets worldwide can be claimed by the Official Receiver and there is only the equity in property that is being lived in that can be bought back. That is not to say, however, that people do not withhold information but we cannot condone this. It is not only people in debt who read sites such as this.

It is up to her what she chooses to do but we cannot advise her to lie - whether or not the OR then feels it is worthwhile to try and get the money from the sale of the property abroad is up to him/her.

I would suggest she reads through the publication on What will happen to your home? which can be obtained from the insolvency website which will give her more information on the subject of jointly owned properties - if there is no equity then her notional beneficial interest will still lodge with the Official Receiver for three years - ie 2 more than the bankruptcy itself but then if there is still no equity it will be returned to her.
By Germ
#294083 Thank-you Sarah,
And I fully agree with your views on the matter. She has been in this situation for about 3yrs now. As far as I'm aware she is not making any payments to the creditors and is not financially in a position to do so. I've read on here about people simply ignoring the hassle till 6yrs have passed. Is that a viable option as a home owner? I would rather she went down this road than what she is contemplating. (although I personally don't agree with that option either) but then I am not in her shoes and only know what I have relayed in this thread.
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By JaneClack
#294123 Only she can decide what to do - she can try hanging on in the hope that the creditor will not go for a county court judgment and then try and get a restriction on her property but even then the debt has not gone - it has just become statute barred and can be chased by companies who have bought the debt and this can go on for years as they pass on to different people. Some people are lucky and it does seem to disappear - my late husband had one that seemed to disappear into the ether and when we had money issues many years ago we went to the CAB for advice and he disclosed all his debts including this even though he had not heard from them for a couple of years and was advised to let sleeping dogs lie and see what happened and nothing ever did. They were fully aware of his address and so on but your sister is being chased - she and she alone will do something or nothing. All you can do is advise if she asks.
By Germ
#294153 Thanks for the reply and advice.
I sat down with her lastnight and had a chat armed with my new information. I didn't know this but the foreign property has been up for sale for over a year. I was wrong, its no where near worth her debt but my argument seemed to be enough to make her see sense to a point and at the moment she plans to do nothing until the property is sold. So no change on the whole but your advice has stopped her doing anything silly at this point. I do have another question. If she does nothing, ie; pay anything to the creditors, (in theory) it can take 6yrs to close. Would she be scuppering that process if she started to make token payments at this point. She defaulted almost 3yrs ago.
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By JaneClack
#294163 If she pays nothing towards the debt and does not acknowledge the debt in writing then - unless the creditor or its agents take court action against her then the debt becomes statute barred which means it cannot be enforced through the legal system after the six year point. If she starts making token payments then the six year clock goes back to zero as she has acknowledged the debt and made a payment.