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davetheman

I am looking at going bankrupt, I am married and only myself going to go bankrupt as I have most of the unsecured debt, however wife does have some.

House is worth around £175K, Interest only Morgage at £169K, and a secured loan of £150K, house is in joint names. As we are in negative equity I believe the house is fine.

I am employed full time and pay the morgage and secured loan, my wife works as casual as an when so no guaranteed work, how this work with the OR?

oneandonlyboy

The joint debt will fall to your wife to pay, you are aware of that arnt you?

davetheman

We realise the debt will fall for my wife to pay, but I would have thought the OR would take this into consideration as she earns so little.

Merry_Gentry

If the house is in negative equity, your wife may be able to buy the beneficial interest for £1 plus £250 OR fees. But if there are any debts in both names, they will fall to your wife once you go BR.

peachyprice

Dave,
As secured debt isn't included in BR you just continue paying the mortgage and secured loan as normal, these will remain joint liabilities and will not fall entirely to your wife. However, any unsecured loans or overdrafts you have will.

The only time this would become a problem is if the house were repossessed, it that instance any shortfall for the mortgage and secured loan would fall entirely to your wife as unsecured lending, and she would most likely have to go bankrupt.

One word of warning, with such a large secured loan it is possible that the OR might say your mortage and SL are too high and you will have to give the house up. This rarely happens but it is a possibility if a suitable rental in your area is a lot cheaper than your mortgage and SL payments.

As Merry has said above, if the OR is fine with you keeping the house your wife should be able to buy the beneficial interest.

fiveyearplan

Do you really want to keep the house? In essence you have over £300,000 of debt for it, how much is that per month? Have you considered both of you going bankrupt and starting again? I'm not really saying you should do this but just want to throw the idea into the air in case you haven't thought of it.

How much would it cost to rent a similar size property in your area?

davetheman

Morgage is £900, and secured loan is currently £600, however the secured loan includes PPI of around £100 and I am trying to claim back. It was suggest by a debt consultant that only myself goes bankrupt, as why do this together as no benefit, if all fails then my wife can go brankrupt.

I realised an error in that the secured loan is 50K and not 150K, this was a typo

peachyprice

davetheman wrote: »

I realised an error in that the secured loan is 50K and not 150K, this was a typo

Phew!!! that's better

fiveyearplan

davetheman wrote: »

I realised an error in that the secured loan is 50K and not 150K, this was a typo

Thank goodness for that! I really didn't see the point of keeping £150k secured debt if you were going bankrupt anyway.

When do you finish paying the secured loan?

davetheman

So with the correct amounts now, is paying the morgage and secured loan acceptable for myself, this will still balance left from my wages to pay towards my creditors

davetheman

about 18 years away, a 20 year loan