Covid 19 bannerCovid 19 banner - mobile

What is the impact of my wife or husband’s sequestration on me?

  • Sharon McDougall -
  • 23rd May 2020 -
  • 3 minutes to read

The nature of sequestration means that your husband or wife’s assets are placed under the control of a trustee. This is the person in charge of selling the assets to repay creditors. In general terms you are not liable for the debts of your spouse, and cannot be ordered to repay their creditors, unless a debt is also in your name.

The nature of family finances can be complex, however, and you could become indirectly involved as the spouse of someone who is being sequestrated if jointly-owned assets such as property enter the equation. Although your share of the asset(s) still belongs to you, the situation can become a little more complicated.

Not all assets are included in the estate of a bankrupt person – most fixtures and fittings in the home, for example, may be exempt, as well as items needed for work or business purposes.

So what happens if you have a financial interest in property?

When your home is jointly-owned

As far as your home is concerned, if it is jointly owned, your husband or wife cannot sell the property without your consent. If this is not forthcoming, the trustee can make an application to the court to gain their authority to sell.

The same applies if you do not own an interest in the property, but have occupancy rights under the Matrimonial Homes (Family Protection) Act, 1981. Again, the trustee is able to apply to the court if they need to sell the property in order to repay creditors.

In these cases you can attend court to argue against the sale of your home, although this does not alter the trustee’s long-term interest in it as a major asset, the proceeds of which generally need to be used at some point to repay creditors.

Even if there is little equity in the property, the trustee has a period of up to three years in which to deal with it. They may revisit the possibility of selling at a later stage during the sequestration period, and can even take this action after your husband or wife’s discharge from bankruptcy.

Trustees understand the impact of losing a home, however, and will make attempts to offer alternative options.

Buying out your partner’s share

One alternative to selling the property on the open market is for you to buy your partner’s share – depending on your own circumstances, this may be possible via a remortgage or other type of investment plan.

If you and your husband or wife own a second property, whether that is a holiday home or rented out to tenants, it’s likely that this will be earmarked for sale as part of the sequestration arrangements if there is equity available.

Your ability to obtain credit

The financial association with your husband or wife could make it more difficult to obtain credit once they have been sequestrated. You can contact the three credit reference agencies, Experian, Equifax, and Callcredit, to request a ‘disassociation’ if this is going to be a problem.

Scotland Debt Solutions helps Scottish residents out of debt. We can provide guidance on what will happen during your partner’s sequestration, and advise on how to proceed should you be a joint property owner.

Sharon McDougall
Sharon McDougall
Manager
About

Why Choose Us

Speak Direct With
Speak Direct With
A Qualified Adviser
We Don't Operate
We Don't Operate
Call Centres
5 Offices in Scotland
5 Offices in Scotland
National Coverage
Ask us About
Ask us About
We Do Home Visits
Fully Regulated Advisors
Fully Regulated Advisors
From a Reputable Firm
Helping Scots Get
Helping Scots Get
Out of Debt Since 1989

We'll give you a call

Our Scottish based team can help advise you on your debt problems.

When should we call?
Can we leave a message?
Here at Scotland Debt Solutions we take your privacy seriously and will only use your personal information to contact you with regards to your enquiry. We will not use your information for marketing purposes. See our Privacy Policy.
Tools

Useful Tools

Personalised Debt Report

Personalised Debt Report

Our personalised debt report will help you better understand your financial position and see where your money is going.

Free Scheduled Call

Free Scheduled Call

 Arrange a call with an expert advisor at a time to suit you.

Find a Local Office

Find a Local Office

We have five offices located across Scotland. Find your nearest one here.

OUR SERVICES

We can help you with...

Sequestration

Sequestration

Sequestration is the Scottish version of bankruptcy and may be suitable for you if you do not have the money to pay back your debts

Trust Deed Scotland

Trust Deed Scotland

A Trust Deed involves making a monthly contribution to your debts for up to four years. After this time any remaining debt will be wiped out.

Debt Arrangement Scheme (DAS)

Debt Arrangement Scheme (DAS)

A Debt Arrangement Scheme (DAS) lets you pay off your debt through a series of manageable instalments over a reasonable length of time.

Business Debts

Business Debts

Whether you are a sole trader or a limited company director, we can help you work through your current financial problems including money owed to HMRC

Close Menu Share with a Friend

Send this page to a friend

via Whatsapp via Messenger via Messenger via Email
Make sure you have WhatsApp installed.

Copy link to clipboard
Close
Edit this Page