On the other questions Pamjo you might want to read the AIB's website and the "what will happen to my house" section in particular.

It states, "Your discharge from bankruptcy does not automatically transfer your property back to you".

It also suggests taking legal advice specific to your circumstances, preferably prior to bankruptcy.

Hi I couldn't find this section on the site.
I think it may not be covered under what happens to your house since we don't live in any of the rental properties. This has been the reason for FSA not taking any interest in the Lloyds yen scenario.

When you say it may not automatically transfer back to you on discharge-I assume you mean the family home and/or any other property owned and controlled by the bankruptcy trustee/IP?

Does property transfer to them on bankruptcy even if the interest is bought ?

Hi Pamjo.

Your assets vest in your Trustee if you become bankrupt. Depending upon the exact circumstances they may then offer the opportunity to purchase their interest if you have a third party that can come up with the funds. The AIB website, as previously mentioned, makes it clear that discharge does not necessarily transfer your property back to you.

Your situation is obviously quite complicated due to the number of properties that you own and I wonder if you might be best off talking through exactly how it works with a neutral body.

The AIB has a helpline which I'm sure would help you to run through such questions without you having a concern that their advice is being tainted by commercial interests.

Bankruptcy works the same way, regardless of whether it is applied for by a debtor or instigated by a creditor - the trustee appointed has the same responsibilities (ie to ingather whatever is available for the benefit of creditors). They may require some sort of payment from a third party to release any property back to you, but if there is no equity then this would be a nominal amount. This could be done at any point in the process.
If they requested such a payment and it wasn't forthcoming then the trustee does not have to release their interest in the property even after discharge.

Thanks TDA and Kevin for those inputs.
I hadn't thought of calling AIB as a neutral party but it makes sense.
Kevin, sorry to labour the point but does that mean if there is little or no equity and someone pays the IP fee at the beginning of the bankruptcy, it transfers at that point? Does this change if equity subsequently accrues before the discharge point?

Hi Pamjo.

If the Trustee offers the chance to pay a nominal fee for their interest in a property (after bankruptcy), and this fee is then paid by a third party within a timescale acceptable to that Trustee, they no longer have an interest in that property.

Hi TDA

To clarify when you say after bankruptcy, does this mean that I've been mis informed re. interest being bought by 3rd party at the outset,ie after bankruptcy has been agreed by AIB,

During the period of bankruptcy,whether 12 months or more,the trustee has the right but no obligation to sell a property, he/she can accept a payment equal to the determined equity if any.

Does this period of the trustee retaining that right extend as long as payments?

Hi Pamjo.

I'm afraid I don't fully understand your question.

I'm not sure if this helps, but the Trustees interest in a property that isn't your dwelling extends indefinitely irrespective of discharge or the end of a payment order/agreement.

I think pamjo may have misinterpreted "after bankruptcy" to mean after discharge? Trust deed assistant merely meant after bankruptcy is awarded.

If a third-party payment is sought by the trustee and then paid then they will relinquish any further interest in the property. A trustee's interest in a dwelling-house automatically expires after 3 years these days, though can easily be extended if they wish.

Sorry, I should have said family home rather than dwelling house, 2 subtly different things!

Hi Folks - I did confuse the term after bankruptcy.
Kevin the distinction is key for me between dwelling house and family home because my husband and I jointly own several rented proeprties. I am confident there will be little equity at present but that could change depending on how long it takes the lender to complete a repossession and any subsequent sale of the one specific rental property which looks likely to be repossessed.
The remaining properties, as it stands now, including our family home will not be likely to sell in the current climate to release funds or we would have done so already.
The figure of £500 payable to an IP is a commonly quoted one for buying the IP interest, assuming after bankruptcy awarded. If I understand you correctly, the IP relinquishes an interest if he or she is paid this fee. (so any increased equity arising before discharge or before the 3/5 years of agreed payments from surplus income would not be sought as either equity payment or sale proceeds) If the IP is not paid this or any such fee, the IP retains the right and obligation to sell any or all assets to release equity or accept that amount in payments from another person instead. This right or obligation remains indefinitely with the IP if not relinguished earlier?

Hi Pamjo.

If it is a rental property rather than your family home their interest in the property could extend indefinitely beyond the discharge from bankruptcy. If equity later developed they may therefore look to sell the property or gather the value by other means.

This would not be the case if they asked for a fee to be paid by a third party to relinquish their interest on a particular property, and this fee was paid by a third party within a timeframe that was acceptable to them.

In the case of your family home their interest might be time-limited though Kevin is indicating that options for extension may exist if the Trustee chooses.

Thanks I think I'm clear now. Part of the confusion is due to 2 different advisors saying that the IP interest is £500(allegedly as per AIB guidance-I have been unable to independently find this information) for each property, per owner, ie £1000 + valuation, payable at the outset, ie after AIB has awarded the case to the IP

Hello Pamjo.

We have heard that different firms ask for this fee in different ways (per property, per individual and per property etc etc).

thanks for all the input on this!!
I was weighing up the sense of applying for bankruptcy if this property is repossessed but it's looking like a very expensive exercise in retaining some control over timing etc.