1st time poster seeking urgent help and advice.

spookyelectric0127

hi,

i came across this excellent forum last night and am hoping for help and advice with our current finanical issues,

my wife, 2 x children and i live in a mortgaged house (GE Money) which we have had for appox 14 months.
Our standrd monthly payment was £960.00 per month, however we fell behind and owe 2k in arrears.
2 x weeks ago we received a lettter requesting we attend court on the 23rd February as they are wanting to reposess.

Obviously scared i phoned them and they said that i could pay the arrears over 24 months which means we now pay £1100.00 a month.

We also have a £300.00 a month unsecured loan and £200.00 a month is paid for a car with have on finance.
Basically we are in a mess and do not have hardly any disposable income available.

Our credit history is poor.

Anyway,

Last week my mum announced that she is moving away with her new partner, therefore her house will be availble and she has asked us if we would like to rent it off her and just cover her mortgage which is £400.00 a month and a massive saving for us.

The problems lie here,

With an early redemption charge we will owe £159,000 for our house and will definately incurr a shortfall.

We have considered volantry reposession but worried about being hit with a massive bill for the shortfall and having pay this off.

We now think that bankruptcy maybe our best option but not sure what to do,

Should we apply for bankruptcy 1st and then volantry reposess or volantry reposess and then apply for bankruptcy?

Also what should i do about the court date on the 23rd Feb, carry on making the £1100.00 a month payments and keep it quiet until things are sorted?

Basically i know nothing at all and we are worried sick.

My mum will be leaving within the next 6 - 8 weeks so i need to do something now.

what is the best way to approach this?

Basically i have to ensure we are not liable for the shortfall and also need to clear/reduce our loan and car finanace as this is crippelling us.

Also,
If we apply for bankruptcy can they adivse we keep or house or are we within our rights to tell them that due to the mortgage payments being so high we would like to find alternative accomodation?

Is there any reason why our bankruptcy would be rejected?

i think what we really need to know is whether bankruptcy is our best option and whether it will clear the shortfall.

What i'm not sure about is whether we should vol reposess before applying for br or the other way round.

Also what should we do about the court hearing on the 23rd of Feb?

My wife is worried that we'll ask for vol repo, apply for br and have it turned down and we are hit with a 50K + shortfall.

As there is no equity in the house and we only have an interest only mortgage can they refuse our offer to find elsewhere to live in the br interview?

Can we just give up the house claiming we can no longer maintain the montly paymemts (even if they ty to reduce them for us)?

Ideally we would like to attend the interview and tell them we pay 1100.00 mortgage, 300.00 loan and 200.00 car and it is killing us, therefore we would like to leave our house and find somewhere else to live.
I'm sure its not that easy.

Looks like i'm going to need you guys for a while so all advice and help will be very, very much appreciated.

mazzatee

Hi

Well done for posting and I'm sure you will get good advice here.

Certainly it sounds a good idea to move to Moms & voluntarily give back your house to GE but dont sign any documents acknowledging any future debts. If you do then you cannot declare these debts in any bankruptcy.

You can file for bankruptcy either before or after you hand back the keys as the debt exists. I think it would be a good idea to get some independant advice first so try some of the debt advice charities - sorry dont have all the contact numbers - like Citizens Advice, CCCS, National Debtline.

Best of luck

Zandytobedebtfree

Welcome to the forum, I think they are all fantastic on here!! :T

mazzatee wrote: »

Certainly it sounds a good idea to move to Moms & voluntarily give back your house to GE but dont sign any documents acknowledging any future debts. If you do then you cannot declare these debts in any bankruptcy.

Just to let you know, that if you did happen to sign anything, then the debt would be declared in the bankruptcy, but it would make more work for the OR, so best not to sign anything.

We did Vol repo, about 2 years ago, and just walked into our bank, went to give them our keys, but as we refused to sign any paperwork, they would not take the keys. This was in the January, and the house was sold by May!! All done without any keys!

So try not to worry too much.

dane-katie

Contact one of the debt charities they will be able to advise you further, when i went bankrupt i contacted CCCS and they helped me:

Number for CCCS 0800 138 1111

Sorry dont have numbers for others as i didnt contact them, but google is you best friend

Good luck!

So_Sad_Angel

Hi Spookyelectric.......great user name (..reminds me that I must pay my electric bill!!:eek: )

Anyway....firstly welcome! most on here have been or are going through the same as you & your OH. You must speak to one of the debt charities (see top toolbar for contact details) get a cuppa & keep your finger on redial if necessary.

CCCS are busy & need appt but they have an online debt remedy that pretty much gives you a decision straight away.... Nat Debtline can give advice straight away but again all very busy.

Cab are great but beware of long waiting times.

Main thing is DO NOT be CONNED into paying for advice!!! Impartial advice should be free!

The house & associated debts seem to have got out of control & the rent option would seem sensible. Maybe post a few more details such as other unsecured, income etc that will give us a bigger picture. Remember BR is the last resort & if there are any other options someone here will spot it.

You are doing the right thing coming here....get as much info as you can & will get confidence from knowing that there is something you can do. You will be amazed how different your outlook will become when you `take control` of the situation.

Take care, keep posting

Angiex

spookyelectric0127

many thanks for all your help,

my mum plans to move within the next 6 - 8 weeks could be earlier

I have been chatting with my wife and this is our current plan so please advise if what we are doing is not the right way to go about it,

We are due in court on the 23rd February.
January's mortgage payment is due tomorrow and they have asked for me to pay £1100.00 so they can suspend the reposession order (will still go to court).
We were going to make this payment and send a letter to them saying that we agree to the £1100.00 a month and would not be attending court.
Wait until we are given a date for my mums move and carry on paying the £1100.00 until this date (may only be Feb to pay).
Once we are given a date send a letter to GE VR and forwarding my mums address.
Don't sign any forms accepting the shortfall.
Once shortfall received, offer low payment or apply for bankruptcy.

the alternative being,
Don't pay tomorrow's mortgage
Don't (or do) go to court have have the house reposessed.
Hopefully being given enough time between now and the eviction date to move into mums.
Is there any difference between VR and reposession with reagrds to the fees/cost incurred and forms to sign?

spookyelectric0127

this is sooooooooooo stressful :mad:

So_Sad_Angel

spookyelectric0127 wrote: »

this is sooooooooooo stressful :mad:

Have a chat with Nat Debtline....you can always delay the mtge payment a few days to give you more time.

No-one can really say yes or no to what you should do....sadly they are decisions we have to make ourselves.

If you have been advised that BR is your best route then so be it....remember you will need £495 each to go BR so that money will need to be saved. If you go BR then all mtge, SL & arrears will be included anyway whether you pay January or not.

After repo court date the judge will normally allow `moving time`....a friend of mine was give 28 days as they had kids etc...it was all very civilised.

Hope that helps...I`m off now...back later.

Angex

fermi

As long as you do not sign a "deed of acknowledgement" after the bankruptcy, then a shortfall will be included.

That would be the case if the bankruptcy took place before repossession/sale

If you went for voluntary repossession after the bankruptcy, then you would have to be very careful what the voluntary repossession forms say. If they give any indication that they declare that you are still "liable" then it is best not to sign them.

If the won't do a voluntary repossession if you won't sign them any court costs they incur along with the shortfall are included in the bankruptcy.

This is true, and has been shown to be so by the experiences of many on this (and other) forums.

fermi

Official info..........

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

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

Answer: 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.

lace109

I've not long joined this forum, but since being on here have had some great advice. I contact NDL as suggested and they gave me great help. Since talking to them, I have now gone down the road of Voluntary repo, have stopped paying my mortgage and my secured loan to GE (this company shouldn't be allowed to trade they are unhelpful, insincere and dont give a flying fig!!).

I am using my mortgage payments and secured loan to save for rented accommodation, then as suggested by NDL hand my keys back and when the court papers come through tick the box saying im not contesting it. I have made myself ill through worry, my kids are stressed and at one point I was paying more interest that the actual monthly payments which meant my outstanding balance went up!!. Since the discussions on here, I feel so much more better, my kids are happier, and I've explained them everything so they know why i was stressed, and they know that within the next couple of months we will be moving, but we will be a lot happier. And even though i know when they eventually sell the house, it may well be lower at least with an unsecureed debt i'm in control of it rather than these big fat finance companies in control of me. My advise, speak to lots of people on here speak to NDL. Once I'd decided my fate I am now in control again.