Bankruptcy Insurance?

[Honeyhot]

Bankruptcy Insurance?
When buying out a partner following a split, is it possible to insure against bankruptcy. Partner left home and has since run up large debts, will accept �5k to sign house over but is possible he will go bankrupt and put property at risk even after signed over.

[WoWo]

given the circumstance i'd be suprised if anybody would cover you. You can get insurance against anything, its just a case of how large the premiums are.

[Honeyhot]

I had heard that an anual payment of around �160 was the going rate

[Didwot]

You are presumably worried about a Trustee in Bankruptcy subsequently seeking a court order to set the deal aside as a transaction at an undervalue (which means just what it says). One thing you must do is to be able to establish that the price you paid was fair, and for this you will need a current valuation of the property, and an up to date mortgage statement. Your ex partner does not have to be paid exactly one half, after all you would incur estate agents and legal fees if the property was sold on the open market, but if he gets about half of the net equity you are a long way toward establishing that it is not a transaction at an undervalue. Various legal title insurers eg Guaranteed Conveyancing Solutions do offer insurance against a seller's bankruptcy, and your solicitor may be able to sort something out for you.