I declared bankruptcy in 1994 for £72000. I was discharged after 3 years. I heard no more until February last year when the Reciever wrote to me asking if I wanted to buy out his interest in my share of the equity in my hose. I was stunned but made an offer which was declined and a trustee was appointed in a firm of accountants.The house now has over 100,000 worth of equity in it although at the time it had negative equity. Inthe original recievers letter in February it mentioned that if there was negative equity then he would settle for a nominal £1. All rather late to tell me this now! I can raise £20000 by borrowing from the lender but this new trustee is asking for £50K which I have no way of paying.

I have written again to my original creditors and three have replied that they would be prepared to settle for a total amount of £5000. One says they have no trace of a debt by me at all so cant agree a settlement. The other creditors amount to only £2000 in total.

I have just recieved a letter from the trustee saying they intend to take possession procedings. do you think on this basis they will get an order?

G

-- Graham Shelton (graham.shelton@yahoo.com), May 17, 2001

Answers

I am a little confused here.I assume that at the time of your Bankruptcy order the OR decided to leave your house alone, but placed a lien on it so that in the event it became an asset within the hiatus period it could be realised. You have now been discharged...so how can the OR retain an interest in your property indefinitely? Was it a conditional discharge or a full one? I must admit I have limited knowledge of this post bankruptcy type of scenario, but I understood that after you got the discharge certificate, the OR had to release the lien, or stay the discharge certificate and realise the asset. Otherwise people would live in perpetual fear of the OR coming back to them and grabbing assets/income at some future date.

Why would you need to settle with creditors from the 1994 bankruptcy anyway? Their debts were included in the bankruptcy and cannot be re-visited after discharge. Perhaps someone with better knowledge of the Law in this area could answer for you. Have you taken legal advice?

-- Too scared to say (iwasduped@yahoo.com), May 17, 2001.