Hi. First things, first. Bankruptcy is a big step, and before deciding if it is the correct path for you, if you haven’t already then seek further advice. Feel free to contact us on 0800 043 6260, for impartial, advert advice – numerous debt solutions are available nowadays, depending on your personal situation.
On the presumption that your mother is not on the deeds of the house, she may still have a beneficial interest in the house because of her financial input to the annex. If you decide to go bankrupt, your case will be handled by an official receiver, who will assess what assets can be considered part of your bankruptcy estate, to help pay off creditors. If the house deeds show ownership split between you and your wife, then your 50% would transfer to the official receiver who would try and release it, perhaps by selling the house.
Because of your annex, the receiver might decide your interest is thus not 50%, but it is up to you and your mother to persuade him or her of this. I would naturally seek further advice on the matter before declaring bankruptcy.
For more details on bankruptcy and properties, see my section on bankruptcy & your home.
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