business and personal debts

mixedupdebt · 17 December 2009 at 10:40PM

Hi all,
Need some complicated debt advice please!

Situation:
Sole director in a 6 month old limited company - growing business debts - likely going into administration early new year.
Personal unsecured debts - approx £45k - all borrowed to fund startup of business and cover living costs during same period. Mixture of CC & bank/CU loans. Starting to have lots of missed payments.

Personal details:
Married. One child under 4. Second child due in Jan 2010. Wife in full time employment. 20k salary, however, this drops to £400 a month SMP in Jan. Wife is debt free (bar the mortgage with me).
Me: No income from business startup (living off above loans). Unemployed for 16 months prior to starting business (Had been trying to start another business which fell apart when banking crisis started). Never signed on (lived off initial remortgage).
Mortgage: Joint with wife. £190k owed. House value £140k (maybe slightly higher). No missed payments. 20 years left.

Actions:
Meeting with CAB. Refered to debt advisor. Can't see me until end of Jan 2010.
Called mortgage lender - LTV too high. Can't change to better deal. On a regulated mortgage. No payment break available. Can't change to interest due to LTV. Will not reduce payments for next year or two.
Spoke with moneyexpert.com - recommended IVA if I could prove income of 1700 a month. Not much chance of that happening anytime soon.

Questions:
Oh so many.
Bankruptcy of one person in a dual mortgage?
Mortgage protection?
Benefits?
Next steps?

Many thanks in advance.

Mixedupdebt.

Pitlanepiglet · 18 December 2009 at 12:25AM

Hi, I didn't want to read and run. Have you tried ringing CCCS? They will usually be able to give you a phone appointment for advice within a week or so and can help you with a strategy to sort all this out. They are a charity so you don't pay for their services.

I can't help with the practical stuff, but there are loads of folk on here who can, hopefully they will be around soon or tomorrow to give you some pointers.

Good luck with the new babe and sorting everything else out, it will get better and you will sort it all x

DarkConvict · 18 December 2009 at 1:49AM

Since you have young children a forced sale due to bankruptcy would be unlikely to occur within the first 12 months, although it is possible you may be allowed to stay or maybe forced into rented accommodation. With it been in negitive equity the OR is unlikely to sell it for a while (but i could be wrong)
Not sure how a joint mortgage works with BR, but it might be the wife becomes fully liable for the mortgage and the house, for better BR advice try posting here - http://forums.moneysavingexpert.com/forumdisplay.html?f=136

I advise you seek advice from both national debtline, and business debtline. Both are free charities and provide professional advice in confidence.

mixedupdebt · 23 December 2009 at 4:28PM

Thanks piglet and DC.

PNPSUKNET · 23 December 2009 at 6:55PM

it its a joint mortgage and their is equity in it, his wife will need to give the 50% share to the OR normaly, sure someone will correct me if Im wrong. Think its time to look at cutting back where possible, take any work if any going to put food on the table as things will get worse once child is born

mixedupdebt · 11 January 2010 at 11:26PM

Hi PNP,

In case you missed it in my first post, the house is negative equity. As for cutting back, we already have. The personal debts where not a result of spending for the sake of spending. All incurred while starting up the business.

mixedupdebt · 11 January 2010 at 11:29PM

Called the CCCS the other day and have started the ball rolling in sorting out the debts. Have started to get letters from some lenders threatening legal action so will be sending letters to all this week with a token £1 payment.

Hopefully have meeting with cccs advisor next week.

Have also signed on - thats fun and games in itself!

mixedupdebt · 12 January 2010 at 10:13PM

Have now received a letter of termination from one CC company. Any template letters available to send to them (or the other lenders)? Am dealing with the cccs so at least have a ref number to give them. Just not sure what to say / not to say in the letter.

Thanks again.

business and personal debts

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