Hi naedosh

if you sign a Trust Deed, then your share in the property would be regarded as an asset and released for your creditors.

Probably not the answer you wanted to hear.

Mark

Hi Mark

Really appreciate your speedy response. Assume you mean the value of my share would be included in the 'pot'?

Two supplemental questions please:-

1) Could creditors force a sale of the house even though my parents have a life rent on this house written into the title deeds also my brother would likely not want to sell?

2) Hypothetically If I don't mention this asset to the trustees - have they any way of finding this out?

I'm concerned for my parents as they do not know of our debts and I don't want them to suffer due to my problems

thanks

Hi naedosh

there are a number of things creditors can do, but generally your interest in the property is at risk. It normally starts with notice of inhibition which prevents you selling transferring etc.

A trustee has a number of ways of checking property owned and can normally do a name search for all property in Scotland.

Mark

thanks for your helpful advice - I'll consider my options very carefully, I don't wish to do anything illegal I'm just wanting to protect my parents' interests and for them not to be thrown out of their house at their age. I guess an option is to ask my brother to buy out our share of the house now.

Hi naedosh,

Whilst a trustee is under an obligation to realise any significant assets, I believe he/she would find it very difficult, if not impossible, to force the sale of the property if it is under a life rent. I think you may find that the asset would be abandoned by the trustee as it is not realisable, though I would urge you to get absolute written clarification on this before entering into any arrangement.

thank you Kevin - I will certainly consider this carefully.

Hi naedosh

I would certainly seek legal advice on the position as it is not quite as cut and dried as you think. If this were the case, then everyone about to enter a Trust Deed or bankruptcy could change their title deeds to include a life rent clause in an attempt to avoid losing the asset. However even allowing for this, normal insolvency rules apply and this would/could be challenged by a Trustee in a 5 year period before his appointment or longer under common law.

Mark

I agree that this is certainly not straightforward and proper legal advice is a good idea.

Certainly if someone was trying to put an asset beyond a trustee's reach by setting up a life-rent arrangement before entering into an insolvency procedure then it would surely be challenged by the trustee, and rightly so.
However, I reckon that the complexion is a little different if the property in question had been transferred into the persons name, presumably for free or a nominal amount, at the same time as the life-rent was arranged. This is obviously not an attempt by a debtor to alienate an asset and could therefore be viewed a little differently I'd have thought.
Mark is right though - very risky ground and legal advice should be sought, as well as an undertaking from any prospective trustee.