The bankrupt person's interest in their home automatically vests in the Trustee immediately the Bankruptcy Order is made. A bankrupt person is normally given 12 months from the date of bankruptcy, before the Trustee may take recovery action against the matrimonial home, however, the Trustee’s interest must be addressed within 3 years from the date of his/her appointment.
If the property is jointly owned, then the non-bankrupt owner will be given the opportunity to purchase the bankrupt’s interest. If the property is in negative equity, then the Official Receiver will give consideration to the bankrupt/non-bankrupt owner to re-purchase his/her interest during the bankruptcy. It is stressed that this opportunity is only available if, the property is in negative equity. If no action is taken by the Official Receiver/Trustee to realise the property during the bankruptcy, the bankrupt may purchase his/her interest after discharge. It is strongly suggested that action is taken to secure the home as soon as possible.
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