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6 Posts

Posted - 01 November 2021 :  12:25:37  Show Profile  Reply with Quote
Hi, my last payment on my trust deed is Jan 2022. This was extended a year to cover equity in my property.

Over the past year, life has changed dramatically. I have had to move out the matrimonial home. I still continue to pay half the mortgage. Unfortunately, I can't get a private let because I've failed the credit check and I can't get social housing because I am still a joint owner.

My husband wants to buy me out the property which I am agreeable too. He too is in a Trust Deed and therefore has not done anything about it.

I am pushing for a solicitor to contact him to get the ball rolling as I need a home for me and my children. If he can buy me out, will the equity that I get from the property be taken by the TD even although the TD was extended by a year?

TDA (Debt Adviser)
Trust Deed Expert

13851 Posts

Posted - 01 November 2021 :  13:50:31  Show Profile  Reply with Quote
Hi Mastyk,

I'm very sorry to hear of these changes and the difficulties that they have caused.

I'm not at all sure that a transfer of the property, before both of you have been discharged from your trust deeds, will be a good idea.

The extra year of payments to your trust deed is a solution to avoid having to actually release the equity. If you actually do release the equity (by selling it to your husband) before you are discharged I think that it's very likely that your trustee will need to gather that in to repay more to your creditors.

If you can afford to, I think you should obtain legal advice to make sure that your own interests are properly protected as you separate.

You may also wish to talk to your trustee to clarify what exactly would happen if you sold your share of the property before you get discharged.

I think there's also a practical issue here, in that it's hard to see how your husband could raise the funds needed to buy you out while in a trust deed or for some time afterwards (assuming that borrowing would be required).

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Paul McDougall
Trust Deed Expert

137 Posts

Posted - 02 November 2021 :  10:26:54  Show Profile  Reply with Quote

I agree TDA, a transfer prior to discharge is not a good idea and will formally require a conveyancing exercise to transfer title and in theory could potentially nullify any Form 1B agreement in respect of the property. Your trustee would need to be involved in this process and would certainly request the funds to be paid over to the trust deed estate.

Most solicitors will provide a quick 30 min initial free chat. I would recommend one that deals with insolvency as well as family law.


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