# I'm bankrupt but wife is not. Mortgage being paid.



## paulgee (22 Jan 2018)

Hi everyone.

Due to a vulture fund applying pressure, I was forced into bankruptcy today.  Does anyone know what attitude PTSB typically takes in the following situation?

Family home in negative equity with the father forced into bankruptcy.  Mother is clear.  House in negative equity by about 100k, but with mortgage in order, with one half warehoused and the other half serviced as per agreement.

Ideally, life will go on as both adults back in education so there is something being done about it.  Is anybody aware of scenarios like this?   Does PTSB allow things to run or do they tend to go nuclear.

All opinions are welcome.

Thank you.


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## TLO (23 Jan 2018)

Chances are that things will be let run.  Just keep making the agreed payments to PTSB.  PTSB, along with all lenders, need a court order to take a family home, and the courts are very reluctant to grant possession orders when payments are being made.  In due course arrangements will need to be made to transfer the Official Assignee's 50% interest in the house to somebody else, probably the mother.  But that is for another day.


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## Alan1962 (26 Jan 2018)

If there is negative equity, the bankruptcy assignee will not take an interest, however if the property rises in value to go into positive equity within 3 years of discharge they will look for the value of the positive equity. They will allow you time to pay this amount.

The procedures governing this are available from the assignee"s office.

The bank can do nothing as long as the payments are been made.


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## Fresh-Start (24 Feb 2018)

PTSB from personal experience will be very slow to do anything. (Years)

Be careful though, if mortgage is in joint names the full amount will possibly still need to be repaid by the second party (mother in this case).


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## Brendan Burgess (24 Feb 2018)

Fresh-Start said:


> if mortgage is in joint names the full amount will possibly still need to be repaid by the second party



Why do you say "possibly"?

There is no possibly about it. The wife is fully responsible for the mortgage and so will have to pay it - unless she too goes for a PIA or bankruptcy.

Brendan


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## Brendan Burgess (24 Feb 2018)

Hi Paul

Although your mortgage is performing, it will now be sold to a vulture fund. I would guess that at the three year review, they will try to scrap the split mortgage and put pressure on your wife to voluntarily surrender or sell the house.

You should get onto your TD and point out the absurdity of this.

Brendan


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## llgon (24 Feb 2018)

Hello Brendan,

How would the courts treat this if his wife resists the pressure and continues to make similar payments on the mortgage?  Impossible to answer but the chances are that the vulture funds will not succeed in the courts unless there is a huge change in how these cases are treated by the courts.

I think that the vulture funds will have no realistic choice except to continue these arrangements.


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## Brendan Burgess (24 Feb 2018)

Hi ligon 

The split mortgage is at the discretion of the lender, I would imagine. 

They can move money from the warehouse to the active mortgage. 

I agree fully that the court is unlikely to grant an order for possession while she is paying. 



Brendan


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## Outsider (23 Mar 2018)

Alan1962 said:


> however if the property rises in value to go into positive equity within 3 years of discharge they will look for the value of the positive equity.


Hi Alan
Do you know does this refer only to property that is sold?
Or does the bankruptcy assignee monitor the value of the property on an ongoing basis even if the property is not put up for sale?


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## Alan1962 (30 Mar 2018)

If you retain the house and it goes I to positive equity within 3 years if discharge you have to pay the difference but they will give you time to pay it.


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## Johnnycash66 (31 Mar 2018)

Alan1962 said:


> If you retain the house and it goes I to positive equity within 3 years if discharge you have to pay the difference but they will give you time to pay it.



Thanks.
But how do they determine whether or not the house is in positive equity?


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## Alan1962 (1 Apr 2018)

I'm guessing they value the house and can easily check what's owed on it

As the house is likely the main asset if any I would imagine its the first thing they look for


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## Johnnycash66 (1 Apr 2018)

Ok thanks


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