Bankruptcy and Divorce Myths

Myth

“My husband and I have separated and he is going bankrupt. However, I have been told I will get the house as I have our young children to bring up.”

Fact: Click to view

In the event of bankruptcy, the security of the matrimonial home will be threatened and the question will arise as to whether the property should be sold to pay off the creditors. It is therefore not a foregone conclusion that you will be able to retain the house. A specialist family lawyer will be able to look at the case and advise accordingly on how best to secure a home for the children.

Myth

“My husband was declared bankrupt before we separated. We still own the family home jointly so I risk losing it in order to pay his debts.”

Fact: Click to view

If your husband was declared bankrupt, you may find that there are creditors wishing to put a charge against the property in order to recover monies owed to them. Although they have the power to apply for the property to be sold straight away, it may not succeed if you are still resident there, particularly if you have dependant children. As and when the property is sold, money to pay your husband’s creditors can only be taken from your husband’s share of the sale proceeds.