Hi lucy

It's certainly a possibility, although unlikely. There would be legal complications in transferring the ownership rights as this would require the bank's consent. There is also the legal costs etc to be met.

If you strip it down, the trustee will seek payment of £18,500 from your partner's ex as her one half share. If this could be achieved by selling or remortgaging the £30k equity property, then it would be problem solved.

Mark

Hi Lucy

Totally agree with Mark that the Trustee will be looking for in the region of £18,500 which represents a half share of the equity in the two properties.

Chris

Thank you for your replies Mark& Chris, we thought this would be the case.
she will be unlikely to raise those funds or borrow it, what will happen then? when are they likely to ask for the equity is it at the end of the deed on her last payment?
and as she not likely to get a remortgage will her trust deed be extended for one year ?

Lucy

All the firms that are on here would have identified the relevant course of action at the commencement of the Trust Deed so the client knows what is expected at the outset and before signing the Trust Deed.

It would be best to go back to the Trustee to seek their view on the intentions but you are right in so much it could be looking for it at the end of the TD, through a third party payment or re-mortgage or extending the Trust Deed, possibly for as long as two years.

I will be surprised though if this a recent TD that the route to resolving the equity has not been built into the Trust Deed process.

Hi lucy,

It looks like your partners ex wife may need to find around £18000 to cover her share of the equity in both properties.

Remortgaging the property with more equity is unlikely to be possible, and unless she makes a large contribution to the trust deed each month paying £18000 over might be deemed to be an excessively long process. There does therefore seem to be some risk that one or both properties might need to be sold.

Your partner has some rights in all of this and I think will want to be in contact with the trustee to discuss where all of this might go. I doubt that exchanging interests in properties is likely to be the way forward, but it does seem like a disposal of the property his ex wife lives in would produce more than enough cash to satisfy any equity responsibilities she has for both properties.

If that's the case, and this property is sold, and your partner is happy for part of his share of the equity in the other property to be paid into the trust deed, there seems little reason for the property he occupies to be touched.

Maybe that's one idea to be discussed with the trustee if it appears that the equity issue will not be resolved easily by other means.

If it goes that way he'd also want to take his own advice on the future ownership of the home he occupies.

Thanks again for the replies TDA and Chris.

rather than the question exchanging interest in the properties what If my partner paid £3500 to her trustee to take the interest off his property I.e-£7000 equity would that be helping pay her creditors? would that benefit him in any way?

Hi lucy,

If it comes to it, the trustee would certainly prefer a third party contribution for equity rather than getting into potentially difficult and expensive disputes.

Communication with the trustee is going to be very important here I think.

Thank you TDA, do you reckon her trustee would speak with my partner regards to the equity then? It would certainly put his mind at rest he didn't think they possibly would with data protection ect. even although it does involve him.

He never new she had entered a trust deed tying up the properties till a few months after it was all done. and is worried what will happen at the end of her TD. but going buy all your answers it looks like the trustee would have more an interest in the house with the higher equity.

he said he'll give them a call tomorrow regards the situation and take it from there.

Hi lucy.

I'm not sure that there's a data protection issue in terms of discussing properties of which he is a joint owner. On that side of things he has rights which should be taken into account.

A wee update- my partner called the trustee today(Carrington dean) They did speak with him with regards to the equity and basically they won't commit to any likely outcome at the end of the td or can't, no firm answer! but in that they did mention all the creditors would be approached and would be aware of the equity in the properties it would be down to them which step they decide to take - therefore it's possible the house with more equity may have to be sold unless the funds can be raised from a third party/relative ect

As far as my partner is aware there has been two x £500 added onto her TD (not paid) possibly paying this at the end of the term - to protect the equity or were guessing this is required to stop any other valuations being done.

there is a an estimated deficiency to unsecured creditors roughly of £35'000 after all monies are paid, really worried how this is going to affect my partner and if there's a possibility the creditors will require his house to be sold, it's quite a stressful time at the moment[V]

Hi lucy.

The £500 mentioned is usually to prevent a revaluation of a property that may (or may not) develop equity but which did not have any at the start of the trust deed.

Generally it has to be paid by a third party.

I wonder if your partner could check with the trustee whether this is the case, and if it is, pay the £500 in connection to the property in which he lives?

He did mention to the trustee with regards to the 2 x £500 this has been added to the total amount in her TD.

If he pays the trustee £500 for his house would that solve any issues? sorry not sure if that answers your question TDA.

there is £7'000 equity roughly in his house too, it all seems so complicated.

Hi lucy,

It may solve the issue, though that needs to be confirmed with the trustee.

The trustee may have concluded that there was no equity in the home at the start of the trust deed (or very little). Valuations used for trust deeds tend to come out a little lower than people sometimes expect.

If there was no equity, an offer of paying £500 to ensure the property wasn't revalued later may have been made. This has to be paid by a third party, for example your partner.

The question to ask the trustee is, if your partner pays the £500 in respect of the home he lives in, whether that will protect the home from any further valuations and from being potentially viewed as an asset to be realised at the end of the trust deed if equity has developed.

TDA thank you again for your help I'll ask him to phone them again. maybe he can ask the trustee to explain things a bit better.