Donate Child Support Calculator
Skip navigation

Property Matter

Add Topic

large amount of debt left over after sale of property, division of this debt

Hi All,

I was wondering if anyone could help a SRL with an application for property matters where I have asked for a split in the debt left over after the sale of a property following divorce. I am being told I need to bring the Mortgage Insurance Company (who the debt now lays with) as a 3rd party in the proceedings because any ruling the court makes in regards to this will not be binding on my ex-partner or will the court instruct the insurance company to pursue him for the debt. I did obtain legal advice prior to putting in an application for property orders but was not told this. I am now being told my only option is bankruptcy. Does anyone happen to have ANY info on this, it would be greatly appreciated…

Thanks
Lauren25,
The question you have asked and the answer would require knowledge of the financial aspects of the case, far more than you should reveal in a public area.

http://flwg.com.au/srl-r/pg/start

The SRLR private site at www.srl-resources.org actually deals with property cases.
no, I didn't want to go into actual private financials on this case here… but just thought someone might still have some general info on how the court may view this particular issue.

I cant seem to join that SLR resources private site :(
if you paid insurance against an event then surely the insurance company has to wear the result - or maybe you could explain in a bit more detail as to why this is "property of the parties, or one of them"
lauren25 said
I cant seem to join that SLR resources private site
Just click on join, read the page, click OK and then complete your details and wait to be contacted.


FLWG passwords do not work on the SRLR site because you have to be verified before gaining access.

SRL-Resources. the Family Law People on this site (look for the Avatars) www.srl-resources.org  Non gender Professional and peer support for SRLs. Closed site, no public forums, no search engines, no lurkers, guests or the other side and their Lawyer and Friends.
Guest said
if you paid insurance against an event then surely the insurance company has to wear the result - or maybe you could explain in a bit more detail as to why this is "property of the parties, or one of them"
 

Sorry, I'm still learning alot of the terminology. What does "property of the parties, or one of them" mean? The insurance company is assessing whether they will accept a claim from the bank we had our loan with to pay them out. But then I am still liable to re-pay the insurance company. But yes, I'm a bit confused about this too. What is the point of taking out mortgage insurance then??
Morgage insurance is taken out to protect the bank, not the owner.
kalimnadancer said
Morgage insurance is taken out to protect the bank, not the owner.
Actually this is a very interesting area indeed. It entirely depends on what sort of insurance was taken out I would think. For example you may well take out mortgage insurance based on loss of job, no earnings, sickness and disability or simply unable to pay the mortgage depending on a  range of criteria. If those circumstances arise and after certain wait times and block out periods in the policy a claim may be made. The bank gets paid out and the insurance company wears the loss less any number of 'fine print' provisions and deductions. Any shortfall will be for the parties to pay in the respective percentage of the matrimonial asset divide.

The first step is to see how much the insurer is likely paying to the bank if they pay at all. My experience with insurance has been that the fine print clauses buried deep in the policies and usually unread by applicants can be significantly problematic.

However when parents separate what is the position of joint mortgage protection insurance? Were the payments kept up? If the parties to the insurance are separate what is the obligation on paying the premium? Is the insurance taken out when the mortgage is raised and therefore both signatures and payment arrangements have been applied possibly as part of the weekly/monthly payment?  Some parents where there is a conflictual situation stop paying the mortgage altogether and rely on the bank taking steps to sell the property. That can take a number of years and meanwhile insurance would possibly have lapsed.

It would be good to have some commentary from an insurer or bank office in relation to how this may all unfold.

Can the insurer get out of any claim due to a separation?

Executive Secretary - Shared Parenting Council of Australia
 Was my post helpful? If so, please let others know about the FamilyLawWebGuide whenever you see the opportunity
 
When property matters go before the court both parties have to submit an accurate financial statement which includes both assets and liabilities, superannuation, existing properties etc. Do not leave out anything or you may pay the penalty later

I am assuming that the property that was sold was part of the marital assets and as such should be included in both yours and your X's statement.  

When it goes before the court the FM/Judge calculates the contributions made from each party, and also takes into consideration the health, earning capacity etc. When all the relevant factors are taken into account a decision is made between how the assets or Debts are to be split which is both just and equitable to both parties.

Bottom line is if the property was part of the marital assets then the debt should be taken into consideration.
IsntLifeGrand said
When property matters go before the court both parties have to submit an accurate financial statement which includes both assets and liabilities, superannuation, existing properties etc. Do not leave out anything or you may pay the penalty later

I am assuming that the property that was sold was part of the marital assets and as such should be included in both yours and your X's statement.

When it goes before the court the FM/Judge calculates the contributions made from each party, and also takes into consideration the health, earning capacity etc. When all the relevant factors are taken into account a decision is made between how the assets or Debts are to be split which is both just and equitable to both parties.

Bottom line is if the property was part of the marital assets then the debt should be taken into consideration.

 

Well the property is now a liability as there is quite a substantial debt left over from the sale of the property as when we sold it the market was at a downturn. It was never really an asset. It is still being assessed by the mortgage insurance company so as yet, there is no quantum amount to go off. Nor when I ring the insurance company, can anyone tell me their policies as to how the money will be recovered. They keep referring me back to the bank and then the bank keeps referring me to the insurance company. Its sortof in no mans land at the moment, which is difficult because it is before the court. I am scared I am liable because my name is still on the loan and will have debt collectors at my door. My capacity to pay it back is nill.

I am now being told anyway the magistrate wont rule on it as any orders wont be binding anyway. That I need to bring the insurance company in as a 3rd party in the proceedings. But if I do that, I could be ordered to pay their costs too. Cant afford that either.
1 guest and 0 members have just viewed this.

Recent Tweets