House Has $30k or More in Equity
So, what will happen to their house when they file for bankruptcy? In this case study we can consider the equity as anything above $30,000 so this would be the same scenario as if their equity was $30,000, $100,000, $300,000 or $1,000,000 it does not make any difference the principle is the same.
Surrendering the House to the Bank.
So, Bob and Sue decide to surrender their house to the bank. The very first thing we at The Gold Coast Bankruptcy Centre would do for them is get them to sign a legal document which resembles a deed of release meaning they have voluntarily surrendered their home.
A Question of Caveats
Bob is a builder in Qld and has really been having a hard time since he hurt his back. He owes $150,000 in overdue accounts to a particular hardware outlet who have been very patient with Bob and are aware of his situation.
When The House is in Your Partners Name and They Don’t Need to Go Bankrupt.
Why Would You Go Bankrupt If You Had Equity In Your House?
But I Have Mortgage Insurance?
Five years ago when Bob and Sue were aiming to buy a home all they could manage to pull together was a deposit of 5%. When they bought their home they went to the bank and the bank was fine with the 5% deposit but they had to also pay for mortgage insurance coverage. Bob and Sue were happy to pay the mortgage insurance due to the fact they didn’t have the required 20% deposit to eliminate paying mortgage insurance premiums and it meant that they could buy a house sooner.