Unmarried couples who are living together are being shown a way out if one of the couple is declared bankrupt.
With 62,000 people being made bankrupt last year and debt levels increasing daily, the reality is that many people could find themselves in this situation if their debts continue to spiral out of control, forcing many to face the prospect of losing their home.
But solicitor Joanne Murray, who specialises in acting on behalf of un-married couples, says there could be a way of saving the family home.
Joanne, said: “Bankruptcy is unfortunately becoming more prevalent as people struggle to contain their debt problems after job losses, illness or other factors out of their control.”
Being made bankrupt is a last resort but it could mean the loss of the family home to pay off some of the debts. When a person is made bankrupt, their assets are no longer theirs, they are controlled by an appointed Trustee in Bankruptcy who can ask the court to order a sale of the property.
Joanne said: “Many of the co-habiting couples I act for, in which the bankrupt party solely owns the property, believe the Trustee in Bankruptcy is entitled to all the equity in the property.
“However there may be a way out in certain circumstances. In various cases I have represented this year, we have been able to prove that the solvent partner has a separate right to an interest in the property, even if they are not the registered owner.
“We have negotiated on the solvent partner’s behalf and agreed that the solvent partner is a joint owner of the property or has a larger share. This has meant, in some situations that the solvent partner can buy their bankrupted partner out of the home, saving it from being sold from underneath them.”
With an estimated two million un-married couples living together in the UK, this is an issue which could affect many in the next 12 months, as debt problems continue to cripple home owners.
If you think you are under such a threat, you should seek legal advice immediately. For more information visit www.stephensons.co.uk or call Stephensons on 01942 777777.
Stephensons has also set up a dedicated website www.debtandrepossesion.co.uk to help people with debt problems.
