Order of sale and possesion on my house

hopfarm · 7 August 2014 at 2:30PM

I was made bankrupt by Lowell's in April 2012 for a £7000 debt , combined all my debts were approx £30,000. ( accrued on credit cards before my x left me with 3 children to bring up ). I paid off approx £20,000 but that wasn't enough . I have now received a letter informing me that my trustee has applied for an order of sale and possesion on my house .The mortgage is completely up to date . Has anyone any experience of going through this process , I have spoken to shelter and they have been great but has said that my best move would be to apply to the council for housing . I live in the house with my new partner and 3 dependent children , we both work full time and have no savings (spent on trying to pay off the bankruptcy ) I would love to here from anyone who has lived through this nightmare for reassurance (really hope someone will help ) .

fermi · 7 August 2014 at 3:34PM

I really feel for you and your family over this. Rest assured you do get through things like this although it is undeniably hard.

Not entirely sure there is anything you can do apart from go with that suggestion on the housing? Maybe legal advice from an IP/sol, or asking somewhere like www.legalbeagles.info/forums/ I'll also ask if DD who advised on your original thread ( http://forums.moneysavingexpert.com/showthread.php?t=3939579 ) can pop in and comment.

longtermplanner · 7 August 2014 at 4:27PM

You both have jobs. You could talk to your local council and they may be able to help you with a deposit so that you can rent privately.

It would be cheaper to get a council house, but you may be placed in temporary accommodation for a long while. Your local CAB will have a better idea what the situation is in your area than people posting on here.

fermi · 7 August 2014 at 7:07PM

Thread with background is here --> http://forums.moneysavingexpert.com/showthread.php?t=3588493

fermi · 8 August 2014 at 7:55AM

So from your thread on LB you say you have £75,000 of equity in the property?

A trustee is not going to let that get away.

silvercar · 8 August 2014 at 8:40AM

fermi wrote: »

So from your thread on LB you say you have £75,000 of equity in the property?

A trustee is not going to let that get away.

But house is owned jointly with OP, so some of that equity (half?) belongs to someone else. I don't know whether current partner has some stake in equity having contributed to house for a number of years.

Is there more equity than debt owed? If so, selling the house will clear it in full.

If there isn't enough equity (that belongs to you not your ex) remember that any amount still owing should fall into your bankruptcy - so don't sign anything that could assign the debt back to you. (Also if you know that there would be a shortfall, you may want to consider not paying the mortgage and saving up a rental deposit.)

I think your first step is to find out how much of the equity is yours and how much belongs to others.

Anyone have a view on whether the trustee would accept a charging order on the property?

fermi · 8 August 2014 at 8:55AM

In 2012 they said:

The mortgage is £120,000 with 15 years to run and the house is worth approx £270,000.

So I would guess that £75K represents a 50 share of equity at market value?

Also say they owed £30K in unsecured debts but have paid of £20K, so £10K left?

But that presumably does not include IP/trustee fees which could already be large, and could be many 10's of thousands when dealing with a property sale.

Could be wrong, but I would say that the trustee does not have much interest in doing a deal. Their best interests could be served by the sale and whopping fees they cream off first from proceeds?

Property in these circs is not my thing though...

dancingfairy · 10 August 2014 at 10:10AM

I think you need to decide if you still going to annul the bankruptcy or whether you are going to let the house go.
If you are still able to you need to know exactly how much it will cost you to get the bankruptcy annulled. You will need to pay off all debts and I believe you will have to pay the official receivers costs. I'm not sure if you will have to interest on the debts up until now and you may have to pay a) for specialist advice and b) for an application to actually annul the bankruptcy (I would assume there may be a cost for this).
IF you can't/decide not to annul the bankruptcy then yes, you will loose the house. You need to find out what happens to any spare equity in the house once it has been sold - do you get the surplus when any debts have been settled or does all of it go into the bankruptcy? If you are likely to loose all the equity then it may be worth fighting to annul the bankrtupcy or consider an IVA.
If you decide to give up on the house then you need to decide whether to continue paying the mortgage. There would seem to be little point to me in paying the mortgage if you are definitely going to loose the house anyway and that money could be saved and put to better use (ie for a deposit on rental or moving expenses) although she should take advice on this.
Shelter are probably your best bet and if they have advised you to apply for council housing then that's probably the route you should take.
Whilst it is scary, I've no doubt you will come out of this the other side.
Regards
df

debt_doctor · 10 August 2014 at 1:43PM

Hi,

It seems to me that an annulment is at this stage beyond your reach, as the costs have increased significantly and you cannot raise the funds to pay off all debts and fees.

Sadly that means that the Order for sale will eventually happen, so you have to plan for re housing. I also have to agree with Fermi that by the time the IPs outrageous fees are added to the debt and other costs there will be little left (if any) of your £75000 equity.

Pressuming the ex (and still joint owner) is still untraceable, then those monies will be held and steps made to trace him. Not sure if your current partner has an beneficial interest claim, not unless he has paid the mortgage, and in any case, this has to be established by a solicitor, and is costly.

As already suggested, you could apply as homeless to the council (when the order for sale is granted) or you can apply now to go on their waiting list now. Councils vary across the country as to how much housing stock they have, and the quality of it.

Private rented will at least give you a choice of where you live, if you are thinking of private rented then you should stop paying the mortgage and use the money for a bond / deposit. Perhaps your partner could apply for the tenancy if he has a better credit rating.

With your question of reassurance from those who have been through the process od losing a home (not necessarily an Order for Sale) - I have been through that process, and I have helped many through such a process. It is of course very tough, but ultimately you will be re housed, you will make a home of it, and you will be finally free of the bankruptcy / possession nightmare.

Then you can truly move forward, especially as you both seem to have reasonable jobs.

Start putting that money away (mortgage payments) -or rather your partner does - don't want your IP seizing your surplus funds. So you could perhaps pay for some of the things he pays for now to enable him to save for the bond / deposit.

Thanks Fermi for alerting me to this thread.

Good luck

DD

silvercar · 10 August 2014 at 3:11PM

Just lost a big post. Grr!

Basically if you know they are taking the house off you there is little point paying your mortgage. Save the money as you may need it for a rental deposit and moving costs.

If there is a chance you can annul the bankruptcy then its worth considering. First thing is to find out how much they want to annul and then consider a private sale to release this money.

Order of sale and possesion on my house

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