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Your House – essential facts

Saving your house

    Your house and bankruptcy


Your House, Your Home


You can remain living in your home (please read the full story here), providing you meet the requirements below:

  • Your lender has a mortgage on the house and can sell it as ‘mortgagee in possession’ if you fail to make your payments.
  • Those payments are treated as an ‘occupation fee’. You must keep maintaining the property, pending the sale of your bankrupt estate’s share in it.
  • If you want to stay long-term, a trusted family member or friend will need to buy out the bankrupt estate’s interest.
  • Before your trustee can talk to a third party about your property, he will check to see if all the financial arrangements are legitimate and not designed to defeat your creditors.
  • Once that has been confirmed, your creditors will be told that the trustee will be realising the interest of the bankrupt estate in the property. They are given time to object, but they must have a legitimate reason to do so.
  • When all the above boxes have been ticked, your trustee can then negotiate with a third party about the purchase of the bankrupt estate’s interest in the property.
  • Please note: the property’s value will be as at the time the agreement is made, not at the date of your bankruptcy. It will be verified by an independent registered valuer.
  • The trustee will be open to realising the equity in the property or selling the property to the associated third party. In both cases, a written contract is needed.
  • To realise the equity, the trustee will subtract the debt owing on the mortgage from the amount provided by the registered valuer, to determine the sale amount.
  • To give certainty and clarity, your trustee will only enter into any dealings with a third party by written agreement. This enables everyone involved to talk freely to the trustee, safe in the knowledge that nothing is binding until a contract is in place and exchanged.

More detailed information on your options regarding your property can be found by calling our Help Desk on 1300 060 122 or email

Alan Nicholls - Registered Trustee

Alan Nicholls’ no obligation help desk

Nicholls & Co provide a free, no obligation ‘help desk’ for people considering bankruptcy – we discuss and explain bankruptcy and answer questions for anyone who is considering bankruptcy. The Nicholls & Co help desk can be accessed by phone  
1300 060 122  or . Alan Nicholls, Registered Trustee in Bankruptcy is also available to answer your questions to enable you to decide if bankruptcy is right for you.