One of the risks associated with managing your residential property and other assets can be minimized when you opt for Creditfix Trust Deed Advice. The risk might become prominent when you have opted to convert your trust deed into protected mode. Then you need to transfer all your assets to the name of the trustee. This includes your residential property. However the law permits certain essential household items, including your car to be excluded from the transfer. The probability of having to mortgage/remortgage/ sell the property will come into picture when the creditors feel that you may not be able to settle the repayment with your sources of income alone. Such a condition will arise when you are unable to conform to the terms and conditions specified in the agreement.
Non Exempt Assets – Creditfix Trust Deed Advice
- Section 5(4A) of the insolvency act has a provision wherein the trustee is able to keep your residential accommodation out of the trust deed coverage. However he may need to convince the creditors that you will be able to repay the outstanding debts without fail regularly. For this you can take the Creditfix Trust Deed Advice.
- Even in situations where the protected trust deed has included your residential accommodation into its coverage, you have the option to retain it under the control of your trustee, by releasing equity on it. if your accommodation is having negative equity associated with it, the trustee can explore the possibility of excluding the property from the coverage of trust deed.
- Before going into the option of releasing the equity (when it is in surplus), the trustee will explore the options for the payment of contributions from your income sources. Only when such options fail that he may be forced to release the equity.
- While releasing the equity he will consider the current market value of your property and evaluate it with respect to the value of equity which needs to be released to the creditors. If the total equity value is greater than the amount to be released to the creditors, he will take the help of the specifications made in Form 1B of the insolvency act to secure the protection of your residential property from being subject to the probability of remortgage or sale.
- Whenever there is a conflict between the probability of sale or remortgage, the trustee can always opt to refer to the Form 3 of the protected trust deed. This will record the minimum possible returns while dealing with your property for the settlement of debts. That means there is a probability of the trustee opting for remortgage rather than having to opt for sale. In such case he will be able to ensure that your property is protected and it stays in his custody until the completion of debt repayment. Once the debt is settled in accordance to the trust deed and the discharge note is issued, you may be able to reclaim your rights on the residential property. You can take the Creditfix Trust Deed Advice for the procedures involved in getting the property released from the trustee.