NSW Release of property after bankruptcy

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Young2850

Member
3 May 2022
2
0
1
Due to a failed business my husband and I filed for bankruptcy in 2018 and then was released in 2021. At time of filing we were allowed to stay in the house we owned because there was no equity in it. After release the trustee told us they still hold the title and for it to come back to us we had to pay them the total of the equity that is now in the house. Is this correct ?
 

Nighthelyn

Well-Known Member
24 September 2014
103
12
414
Sydney
Dear Young2850,

If the house was seized as a result of the bankruptcy by your trustee, then you effectively has no further claim nor right to the house. No equity means the property is owed more than its value, but otherwise does not affect your trustee’s right over the property. Your trustee has the right to sell the house even after your bankruptcy ends. However there are limits that apply to the amount of time your trustee has to deal with the property.

The sale by the trustee can be to anyone it decides subject to the law, including to you if you can pay them.

See further info here:


Good luck!

-Nighthelyn
 

Young2850

Member
3 May 2022
2
0
1
Dear Young2850,

If the house was seized as a result of the bankruptcy by your trustee, then you effectively has no further claim nor right to the house. No equity means the property is owed more than its value, but otherwise does not affect your trustee’s right over the property. Your trustee has the right to sell the house even after your bankruptcy ends. However there are limits that apply to the amount of time your trustee has to deal with the property.

The sale by the trustee can be to anyone it decides subject to the law, including to you if you can pay them.

See further info here:


Good luck!

-Nighthelyn
Thanks for the reply. I guess my question is, if the property now has equity greater than the original debt owed at time if bankruptcy why would they want all the equity. Eg. if debts were $100,000 and now there is $200,000 equity in the home why would they want the whole $200,000.
We have continued to live in the house and pay the mortgage during the whole period.