Bankruptcy in Wollongong – Concerned about losing your home?

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Bankruptcy in Wollongong – Concerned about losing your home?

Bankruptcy in Wollongong is a difficult task, but I recognize from meeting with thousands facing the chance of personal bankruptcy throughout the years that the most frightening thought is the fear of losing the family residential property.

untitled-1Practically every person is on an emotional degree linked to their house – it’s where the children 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 a thing like bankruptcy can move in and take all that off you.

So, Will you lose your home if you declare bankruptcy?

My answer is ‘possibly’– I recognize it is not a helpful answer, but it is going to really depend on your unique scenarios. People usually believe that losing your house is unpreventable and just another part of Bankruptcy– but don’t make yourself mad right now, as there could be hope.

So how does bankruptcy view my house?

The first thing to know is that homes are deemed assets– but no two houses will be the same. What you need to grasp is that whenever it comes to Bankruptcy, they appoint a trustee to oversee the process. Their task is to make certain that they can pay off as many of your liabilities with your asset. This is completed through equity– and if there is no equity in your house then there is no true benefit to selling it.

Trustees not selling residential properties is happening considerably more ever since the GFC as house prices in many areas have been going south so what you spent 4 years ago may not immediately demonstrate the price nowadays.

But the biggest part with Wollongong and Bankruptcy is that you truly should get a professional to help you with this process, there are lots of variables in these situations that should be considered.

As an example, if you have no equity in your home you will need to think about your bank loan. With loans, you are essentially just a client of the financial institution and they will similarly have a choice– will they wish to take your house back, or do they want you to keep the home loan? You might believe that they would wish to just take your home to steer clear of the risk, but honestly banks are run as a business, and if they can leave you with a mortgage to keep generating income off you, they generally will provided that you keep up to date with your repayments. However it is still up to the trustee to identify that there is a lot of equity in your home the trustee will force you and the bank to sell off your home.

What is my home worth?

Typically with Bankruptcy it is hard to know what your house is really worth– yes, you may have an idea if you were selling your house, but the way that this is worked out in personal bankruptcy is generally different. When you declare insolvency you will need to note down the value of the house, and the amount of money that you owe– and you can work this out by using a valuer. This is going to be far more precise than applying your ‘gut feel’ or a real estate agent. The other important factor is that you ought to ask your valuer for two values– one for a Quick Sale, and one for a non-time sensitive sale. This will give you 2 realistic figures that can help you to correctly value the residential property and grasp its value even when you are being pushed to sell swiftly.

When it comes to Bankruptcy and properties, an additional major factor to consider is ownership, in a lot of cases homes are bought in shared titles. In other words a couple may have bought a house 50/50 making use of both salaries to make the repayments. If one party declares bankruptcy and the other party does not, the equity is solely factored on the 50 % of the home. With Bankruptcy, this is merely one of undoubtedly numerous scenarios that are likely when it relates to the family home. Bear in mind the non-bankrupt party can buy the bankrupt’s part of the home in insolvency too. I should repeat this but get some guidance on this area of Bankruptcy considering that it is very complicated and every scenario is different.

If you genuinely wish to find out more about what to do, where to turn and what questions to ask about Bankruptcy, then do not hesitate to reach out to Bankruptcy Experts Wollongong on 1300 795 575, or visit our website: www.bankruptcyexpertswollongong.com.au.

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