it going bankcrupt the right thing to do

Queen

Hi have a unsecured loan with RBS not able to meet credit committments due to husbands ill health, they have instructed sols to take us to court for a CCJ forthwith to get a charging order, I have discussed every route poss with payplan and NDL don't know where to turn, we have a property value approc £185,000 if we are lucky, mortgage £165,000 and secured loan of £17,000 approx so I don't think there would be any equity, so would going bankrupt be the right thing for us or just to let them get the charging order and see what happens. I understand that we need to act on this before the charging order is granted as this will be a secured loan and cann't be included in the BR, how long does the process taken,and if we applied for this are we able to change mind before things are finalised having a really stressful time:(

Wildr

Hi Q!

My advice (having just gone BR myself) is to speak to the Consumer Credit Counselling Service http://www.cccs.co.uk

They are extremely knowledgeable and helpful and as they are a registered charity their advice is free - they really did help me get things straight in my mind and work on a plan to resolve my issues.

Good luck,

R.

blind-as-a-bat_2

It does sound like BR is a viable option (but follow Wildr advice and get proper advice)

However BR does not allways stop a charging order being made, although it may be overturned if the tiMng is right, so you need to keep on top of that too, If you have only just got a court summons for CCJ then that shouldnt be a problem, but defend it in full, to delaY IT AS MUCH AS POSS;)

Queen

Thanks for comments just really worried about losing the house will speak with CCCS did you have to sell your house

blind-as-a-bat_2

No, i was lucky that way, as i rent so didnt have that added complication, but i do know that creditors will try get round the system if they can so dont give them chance, so use that system against them if you can because it is very, very slow, so if your at the start you can use it to your advantage

RichOneday_2

This all depends what your other outgoings are.

If your finances are healthy once you've taken away the RBS payments, then the charging order is quite a neat little solution.

You can forget about it then until you sell the house, it will be frozen in time with no interest accumulation. Having no equity is irrelevant. They will just wait and wait.

The only downside is you could come unstuck if you were thinking of moving in the next few years because if there wasn't enough value to cover the mortgage, loan and RBS then you would need their permission to release it. Don't be too concerned about this because if there is still no equity when you want to sell you can make an offer to release the charge - in 5 years they may accept 10% of face value just to get some money.

Queen

Thanks for advice I have spoken with Insolvency helpline who can only tell you for pro's and con's and cann't advise what is the best option for us she is concerned that we go bankrupt now and cann't maintain the mortgage and there is a shortfall after we sell or reposession then we need to go bankrupt again and this would last for 15yrs, heard nothing froms sols from RBS so no court order or anthing yet not even a letter advising that they are acting for RBS, we have only been advised by RBS that our file as been passed to sols to obtain charging order this was back on the 3rd July will have a good think over the weekend which is the best option, I have also been advised that there can be upto a 2 month wait with court so they may get the charging order in this time

fermi

Queen wrote: »

Thanks for advice I have spoken with Insolvency helpline who can only tell you for pro's and con's and cann't advise what is the best option for us she is concerned that we go bankrupt now and cann't maintain the mortgage and there is a shortfall after we sell or reposession then we need to go bankrupt again and this would last for 15yrs,

Who actually are the Insolvency Helpline, because I am dubious about that advice.

This is what the official government Insolvency Service have to say on their own website about future shortfalls on a property sold or repossessed after the bankruptcy.

Link: If my house is sold sometime after the bankruptcy order is any shortfall on the mortgage still a debt in my bankruptcy?

A debt which is secured by a mortgage or a charge on a property is still a provable bankruptcy debt. The mortgage loan company is "a secured creditor" which means they have rights over an asset, the house, and can require the asset to be sold to pay their debt. These rights are not affected by the bankruptcy.

On the making of a bankruptcy order the mortgage loan company could
make a claim in the proceedings but, unless it wished to give up the security, could only claim for any (estimated) shortfall.

If you continue to live in the property it is likely that you will continue to make payments to the mortgage loan company to avoid the property being re-possessed. When the property is eventually sold any shortfall to the mortgage loan company is still a provable debt in the bankruptcy, even if you have been discharged, as you are released from the debt on discharge.

Your bankruptcy does not affect the obligations of any joint owner who has not been made bankrupt to repay the mortgage loan debt or any shortfall, as they are still liable for the whole of the debt.

After the date of the bankruptcy order the mortgage loan creditor may ask you to sign a "deed of acknowledgment" of the outstanding debt. If you have signed such a deed the mortgage loan creditor can take action against you to recover any shortfall following the sale of the property.

I think you would be wise to take some further advice from CCCS or National Debtline.

RichOneday_2

The Insolvency Helpline are not an official body, just another IVA company in essence.

fermi

RichOneday wrote: »

The Insolvency Helpline are not an official body, just another IVA company in essence.

Yep.

The problem is that people sometimes refer to that name when they actually mean the official Insolvency Service enquiry line, and vice versa.

So I want to check which it actually was.

Queen

spoken with NDl who have give me some advice on bankruptcy but cann't advise me which is the best thing to do, have been told that property should not be effected no equity or very little, but worried about the car value approx £4,000 and needs this to get to work and back, has anybody else been in the same situ have not got long to make up our mind what we are going to do as we need to do this before the charging order is granted.