Hi all,

I just wanted some advice concerning my wife potentially going bankrupt.

Unfortunately after learning that my wife had hidden £25K debt from me for the last 4 years (which he said she had accumulated through reckless spending & gaming largely without my knowledge, and partly due to post-natel depression), we have decided to live separately (the debt not being the only reason for this separation mind). All of this debt has been accumulated through transactions, credit cards and loans in her name alone.

Since living separately I have been in the process of removing her name from the mortgage and deeds (at my great cost!). The property is the only asset (!?) that we had in joint names (we have never had joint bank accounts, and my name has been on virtually all of the our household bills in the past). The property is almost certainly in negative equity (as shown by free evaluations carried out recently by various local estate agents recently) hence my wife is happy to sign over the property solely in my name, as she knows she will get no profit out of the transfer.

I am now looking to legally separate (but not divorce at the moment). The questions is if my wife actually goes bankrupt (which I fear is inevitable) when she finds out that income support (stay at home mum with two kids) is not enough to cover the monthly debt repayments, are the receivers going to be asking for an interest in the property (equity) and/or what is left of my meagre savings!? Even though I did initially want us to still stay together by paying her debt, I’m unable to even pay a small portion of her debt with what savings I have left (unless I win a tidy sum on the lottery!).

Even if I were to help pay it back in monthly instalments then I would be declared bankrupt myself within a matter of months too, then affecting my job! Besides, I will need what savings I have left to buy new furniture to replace what my wife has taken, pay the solicitors, IFA, mortgage fees, etc. not to mention having to paying her bankruptcy court deposit of £525 as she won’t be in a position to pay it! (does she have to pay this even if we are not legally separated by this stage??).

Unfortunately I had wasted virtually all of my savings by ploughing it into the mortgage over the last 12 months, trying to lower the monthly repayments so I can manage my finances better, and so I’m able to now pay the bills every month without fear of getting into to debt.

I say ‘wasted’ because it seems SVR mortgages are about to rise across the UK over the coming months, therefore cancelling out any saving I was trying to make in the first place (I’m/we’re unable to fix our mortgage or arrange a new mortgage despite my efforts, due to my wife’s debt AND being negative equity prisoners!!).

I have successfully removed her name from the mortgage and my solicitor is in the process of removing her name from the deeds. Even though her name would hopefully have been taken off of the deeds to the property by the time she is declared bankrupt (bearing in mind there is no equity in the property), can the receivers still pursue me to pay as much as her debt as possible from my any savings I have left after solicitors, IFA, mortgage fees, etc. ? Note that she has never made a financial contribution to the mortgage payments from the time we purchased the property in joint names (with the exception of £1000 given to me directly, over the course of three months in 2006, shortly before she gave up working to raise our two children).

Can they come looking to me to pay any of the debt if I have not completed the legal separation by the time she goes bankrupt? If they do then there would I would not have much savings left to give them.

Help on these matters would be greatly appreciated!