Bankruptcy in Cassowary Coast is a difficult task, but I realise from meeting with thousands experiencing the possibility of going bankrupt over the years that the most frightening element is the distress of losing the family home.
Practically everyone is on an emotional level attached to their house – it’s where the kids have grown up, it’s the place you sleep, eat, unwind and built it from a house to a home. So it is frightening to think that something like personal bankruptcy can move in and take all that off you.
So, Will you lose your home if you go bankrupt?
My response is ‘maybe’– I understand it is not an useful reply, but it will really based upon your unique scenarios. People usually think that losing your home is inevitable and just an additional part of Bankruptcy– but don’t make yourself mad right now, because there might be hope.
So how does personal bankruptcy view my house?
The first thing to understand is that houses are viewed as assets– but no two homes will be the same. What you really should be aware of is that whenever it concerns Bankruptcy, they designate a trustee to oversee the procedure. Their job is to make sure that they can pay off as many of your debts with your asset. This is performed through equity– and if there is no equity in your house then there certainly is no true advantage to selling it.
Trustees not selling residential properties is occurring considerably more ever since the GFC as house prices in many locations have been going south so what you paid 4 years ago may not immediately demonstrate the price today.
However the most significant part with Cassowary Coast and Bankruptcy is that you truly should get a professional to help you with this procedure, there are a number of factors in these scenarios that should be considered.
For example, if you have no equity in your home you should consider your bank loan. With loans, you are essentially just a customer of the bank and they will also have a choice– do they wish to take your house back, or do they want you to keep the home loan? You might believe that they would certainly want to just take your home to avoid the risk, but frankly financial institutions are run as a business, and if they can leave you with a loan to keep generating income off you, they generally will provided that you keep up to date with your monthly payments. But it is still up to the trustee to establish that there is a lot of equity in your home the trustee will force you and the bank to sell your home.
What is my home worth?
Typically with Bankruptcy it is hard to know what your house is actually worth– indeed, you may have an idea if you were selling off your house, but the manner in which this is calculated in insolvency is generally varied. When you file for insolvency you will need to note down the value of your house, and the amount that you owe– and you can figure this out by utilizing a valuer. This is going to be far more accurate than using your ‘gut feel’ or a real estate agent. The other important factor is that you should ask your valuer for two values– one for a Quick Sale, and one for a non-time sensitive sale. This will give you 2 rational numbers that can help you to correctly value the property and realise its value even if you are being pushed to sell quickly.
When it comes to Bankruptcy and homes, another major point to consider is ownership, in a lot of cases homes are bought in joint names. In other words a couple may have bought a house 50/50 utilizing both incomes to make the repayments. If one party declares bankruptcy and the other party does not, the equity is only factored on the 50 % of the property. With Bankruptcy, this is merely one of possibly various circumstances that are probable when it relates to the family home. Bear in mind the non-bankrupt party can purchase the bankrupt’s part of the house in bankruptcy also. I must repeat this but get some advice on this area of Bankruptcy given that it is very complicated and every single situation is different.
If you truly want to find out more about what to do, where to turn and what questions to ask about Bankruptcy, then do not hesitate to talk to Bankruptcy Experts Cassowary Coast on 1300 795 575, or visit our website: www.bankruptcyexpertscassowarycoast.com.au.