Request for some advice!

Tired_Old_Man

I would like to start with an apology. This post is going to ramble on for a bit. Part of it is just to vent. I also need some advice. So if you'd rather skip my tale of sorrow then please feel free to skip to the last two paragraphs!

For the last 20 year due to my ill health (chronic kidney failure and mental health problems) my work history has been patchy. However with my wife working we’ve always got by and along the way we’ve taken chunks of equity out of the house. We last re-mortgaged 2 years ago and we got the last of the equity and took on a sub prime 100% mortgage for £200,000 paying it back interest only at £1,200 a month. It was tight but with my benefits and a little private pension (I finally retired on health grounds) we got by. However this last December my wife was given notice (she works for a charity and with the credit crunch the sources of income for the charities have dried up). She’s 60 now anyway and she can start drawing a state pension, get a little monthly payout from an occupation pension and get some carers allowance for being lumbered with me. My two children (grown up) make huge sacrifices to keep us going and they’ve effectively had to but their lives on hold to help support us (sadly all I have to leave them is a legacy of potential kidney disease, diabetes and mental illness!). I realise that most of this is self inflicted, but I really just wanted to give my family all they needed and give my children opportunities to go to University.

In addition to my £200,000 mortgage I have 45,000 of unsecured loans. These are under control as I’ve got payment arrangements and CCJs in place so I service these at no more that £40 a month. Basically I’m at the point where I owe £245,000 and my assets are £195,000 (and if you read the news reports houseprices are only falling). The house I live in is in a good area, but it’s in a terrible state. I really don't know if it wold sell any time soon. If I was to rent a similar house (slightly smaller but luxurious compared to my house!) I could rent for £750 a month. Really this is the advice I need. What stops me from moving is the lack of security. I can get a 2 year tenancy on a nice house, but what then? I worry that during the tenancy I could be booted out if the Land Lord wants to sell or what ever. So I need some advice on experiences of renting. The second thing I need advice on is can I just hand the house back to the finance company and go? Ideally I’d like to stop paying the mortgage and put a few months money behind us for a deposit. How long would I be able to stay in my home without paying the mortgage? The third aspect is that I have no hope of paying back the £45,000 of debt. If I have no assets then would they look at writing them off or would I still have to go for bankruptcy?

I could try and stay in the house that my children grew up in and I could struggle but I would be left with nothing every month. Also the constant task of dealing with DCA’s letter and phone calls is just wearing me down. Any advice would be much appreciated. Everything is so muddled and I just need some advice on what order I should put things in to.


Thank you

tigerfeet2006

Hi and welcome to the board.

The first thing you need to do is contact one of the debt charities in my sig. and get their advise. If they advise BR then we can help and support you through the process. You also need to do this as the judge could delay your petition until you have.

As for the house if you could afford to pay the mortgage and any secured loans on it then you should be able to stay. If you can't then as you have said just stop paying your mortgage and debts (keep up utilities and council tax etc.) and save the money for a deposit and the BR fees. When you move out of the house you can then send the keys back. In the present climate companies are doing there best to help people stay in their houses so it couldbe up to 6 months before they start proceedings and you will still get a month or two after that.

All the best and keep asking questions and reading. The first thing to read is the first post of the Bankruptcy Help sticky as there is a lot of useful info and links there.

suegoo

Just a quick thought, your local authority has a duty to house you if you are considered vulnerable, which you would be. That would give you the security you need, much better than renting privately.