worried about the future

debt_doctor

Hi what I was suggesting was to make a new statemnt based on as if you were renting so that you could compare the two situations, to give you an informed choice.

It is my belief that you would be £ 276 per month better off renting compared to your mort payment, £ 35 per month better off with no buildings insurance, £ 80 per month better off with your gas / elect debts removed and £ 303 per month better off without your other debts.

The price to be paid for that is the implications of BR ( contact a debt charity ) The loss of your present home ( you could keep it in BR but it seems to be unaffordable ) and the opinions / feelings of others in your family.

I believe that your final BR debts would be much higher with a probable shortfall from the sale of your house.

I also think you should look again at the opinions of fiveyearplan, who I have the greatest of respect for. That may well be an opinion shared by your partner and others on here.

Bankruptcy is an individual choice of someone for their own personal reasons.

Good luck with the chat to your family and let us know how you get on.

DD

alfiemama

Hi dd

Sorry I was asnwering 5yp question, I agree with you that he has come up with some good points, you both have and I thank you very much.
£600 a month better of at this stage would be fantastic, but in long term maybe I would be worse of, not sure? lots to mill over
I think we are going to try and sell first then we can just rent for a little while save up for a deposit and then buy again, going to be a struggle but hopefully will be worth it.

Thanks again everyone you have made things much clearer for me

debt_doctor

I do not find that mort co's would be at all sympathetic to that. They would either make it difficult for you to go ahead with the sale or at least chase you for it as a debt afterwards.

DD

debt_doctor

ok best of luck with that, we are glad that helped.

DD

alfiemama

Hi dd

Sorry to keep asking all these questions

Can a mortgage company totally block a sale if you owe the redemption or will you just go to court because of the debt, surely if this is the case the judge maybe more lenient and we wouldnt need to go br

hope that makes sense

fiveyearplan

I'm really confused here. It looks like the only reason you will be needing to go bankrupt is if you sell your house. Why would you want to sell it if thats the case. You appear to have enough income to service the mortgage and living expenses. Can you not sell the caravan and come to an arrangement with your other creditors? If it was me (granted I accept this is not me) I wouldn't want to lose the equity in my house for that kind of debt. What part of the country do you live? My house hasn't decreased in value at all and yours may not have decreased by much either and it will go up in the future - that is almost guaranteed. Look what happened to house prices after the last slump - they went through the roof.

I would stongly advise getting some more advice from CCCS and National Debtline and CAB and think carefully of all BR will cost you. Its not a walk in the park. On the otherhand you might decide BR is right for you. I just don't think you've given enough information here for anyone to give reasonable advice.

alfiemama

Hi 5yp

Sorry I didnt mean to confuse everyone, I live in the North, surely everyones house has decreased in value, it is only what someone is willing to pay and the market is just not moving, for us to move we are pron going to end up with a small shortfall, we are going to try anyway and see what happens, my origional question was with regards to 2 years time if the market stays the same or gets worse.

It is a struggle on a basic month which I did explain that hubby does sometimes get commision, like I mentioned we are not too bad bill wise just a juggle month to month but can be done, my concern is the house, I have just been researching C & G and since March there rate has gone up half a percent which mean we would have to find another £350 a month based on that.

I suppose its like dd said if only we had a crystal ball and maybe I am panicking over the future a little but surely it makes sense to start thinking how this will affect us now rather than leaving it and hoping

maxmycardagain

alfiemama wrote: »

we have got it wrong sorry, house was valued at £205 and mortgage £185k but a redemption penaltyof 5k if sold before June 09 after that 3k

How lenient are mortgage companys on this penalty, ie if we sold privately which may now be poss but we may not be able to pay penalty.

CONSIDER THIS.....

my mates wife died at the start of january

it took till end of july to get the insurers to complete the mortgage claim, during which he paid his mortgage and was owed 7 months at £250

so he was owed £1750

he didnt get it due to?.....


the early redemption fee

wheres that post about how we should all feel guilty over bad debts?...

fiveyearplan

Hi AM, I wouldn't start to worry about what might/might not happen in 2 years. You just can't predict what will happen to property prices in that time.

I live in London and my house price has gone up £80 since it was valued for my last remortgage (October 2006). Prices here are not decreasing (for once I wish they would because I'm bankrupt and my OH would like to purchase the BI).

I wish you good luck whatever you decide.

RichOneday_2

alfiemama wrote: »

Hi 5yp

Sorry I didnt mean to confuse everyone, I live in the North, surely everyones house has decreased in value, it is only what someone is willing to pay and the market is just not moving, for us to move we are pron going to end up with a small shortfall, we are going to try anyway and see what happens, my origional question was with regards to 2 years time if the market stays the same or gets worse.

It is a struggle on a basic month which I did explain that hubby does sometimes get commision, like I mentioned we are not too bad bill wise just a juggle month to month but can be done, my concern is the house, I have just been researching C & G and since March there rate has gone up half a percent which mean we would have to find another £350 a month based on that.

I suppose its like dd said if only we had a crystal ball and maybe I am panicking over the future a little but surely it makes sense to start thinking how this will affect us now rather than leaving it and hoping

You are right in the sense of there probably being no equity in the property. You're not particularly concerned about how an estate agent would value your property, that is an irrelevancy. The valuations which are relevant are:

1. What would a panel valuer give as a valuation for remortgage purposes. In the last downturn a lot of sales/remortgages fell through because of panel valuers undervaluing and being over cautious. They were basically covering their backs for justifiable reasons. This will happen again.

2. What a purchaser would actually pay should you put it on the open market. As we know the few purchasers in the market have all the power so can drive hard bargains.

Either way you are probably looking at little or no equity even now. In terms of sitting out for a recovery to build some equity into the equation you are probably looking at having to wait until 2012/3 at least for that to be likely.

You could try to sell the property and if a small shortfall results make an arrangement with the lender. But then you have another debt to cover. As you have said it all depends how much you can save monthly by renting and whether it improves the situation enough.

It looks like you may be able to cut £400pm out by renting with a reduction in council tax/utilities etc which must make things a lot more comfortable.

You will probably be able to re-enter the property market in 2-3 years time at a lower level than today when you've got everything under control.

IMO it doesn't look like a bankruptcy situation at all but talk to one of the debt charities as a first port of call.