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Equity

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(@denster)
New Member
Joined: 14 years ago
Posts: 1
Topic starter  

Brand new to the forum.

I am looking at a trust deed just now, meeting with an advisor through the week.

Before I go, I need some advice on something that has been mentioned to me about the equity in the property.

I have debts of around 48k, and there is around 45k in equity in a jointly owned property. This would mean that circa 20k would need to be released as part of the deed.

Someone has suggested that an inhibition order (charging order?) could be placed on the property to the benfit of an external party (family, friend that you can trust) for the value of the equity (if not more) which would prevent the equity being taken into consideration.

Is this possible?


   
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Mark McFadyen
(@mark-mcfadyen)
Famed Member
Joined: 16 years ago
Posts: 4798
 

Hi denster

In simple terms no. An inhibition is a form of legal action by a creditor to stop you selling the property.

If you proceed to sign, the Trustee will seek half the net equity in the house. Even if there was a way of assigning equity to family, friends etc, the Trustee could have this 'cut down' in a 5 year period after it was done.

I think you need to fully consider the equity position carefully. If it is only you signing, then you could organise third party payments etc in reduction of this.

Are you meeting someone from the Trustees office or a 'financial advisor' from a middleman company.

Mark

Mark is not posting regularly in the Trust-deed.co.uk forum.


   
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 Mac
(@mac)
Eminent Member
Joined: 14 years ago
Posts: 27
 

Hi
Just a word of warning re- equity. Im at the end of my trust deed now and due to advice given in this forum I am much more aware of the system. Wish I had known about the site three years ago !

Anyway be very careful when it comes to your TD company valuing your property - if you think it is too high or unrealistic ( check what is the going rate in your area and how long properties are taking to sell)then you must challenge the valuation as you will be tied to the valuation three years down the line.

Our house was valued by the trust deed company three years ago at 150k. We thought at the time it seemed a bit high but I didnt know and was not told, i could get my own chartered surveyor to value it. It would have been valued less - I just found this out from my own surveyor who said that 3yrs ago 150k was very unrealistic.

Anyway the equity was based on the 150k valuation and now im at the end of the td and the TD company re valued the property in today's poor climate at 130k. I am wiser now and knew I could challenge this so I got my own surveyor and he valued it at 120k. At the moment im waiting to see the outcome of a letter ive written proposing to close the trust deed with a much lower lump sum based on the 120k valuation- its a 10k difference

My advice would be to make sure the equity is based on a true valuation cos you will be tied to it. Get your own chartered surveyor so you can challenge any high valuation- I used DE Shepherd and it was 100 quid- well worth it !!!

Good luck
Mac

Mac


   
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