I think there's only one option...

peachyprice

dvs wrote: »

Hi sieve, I'm not sure where you stand with regards to repayment mortgages but I'm sure someone else on here will...

Does anyone know what the situation is with repayment mortgages and working out your income and expenditure? Will the OR insist that the mortgage is an interest only one or will they allow you to make capital repayments ?

You carry on paying your mortgage as normal regardless of whether repayment or interest only.

fc123

Hi I re sent the PM...it's full of typos tho' as I couldn't edit it...and I can't type ;-).

dvs

peachyprice wrote: »

You carry on paying your mortgage as normal regardless of whether repayment or interest only.

Hi peachyprice

I'm surprised that is the case as it seems a little unfair on creditors that they might not get any repayment (post bankruptcy) because surplus income is being used to repay the capital on a mortgage. (Not saying that you are wrong but it does surprise me!) Does this mean it's more likely that the OR may want you to sell the house to reduce your outgoings?

tigerfeet2006

No, not at all. If there is negative equity then the OR will usually offer you to buy the beneficial interest (BI) for £1 plus costs of around £250.

sieve

tigerfeet2006 wrote: »

No, not at all. If there is negative equity then the OR will usually offer you to buy the beneficial interest (BI) for £1 plus costs of around £250.

Thanks Tigerfeet. Hopefully that will be offered to me.

DVS - I don't think it's really in the OR's interest to insist on going interest-only as I know my lender won't budge on anything while I'm in my redemption period without charging the ERP. This includes going from repayment to interest only - so if the OR changed my mortgage, there would be £10k less in the pot, plus my home is in negative equity so it wouldn't make much sense to do it.

Thanks again all. In a queue for citizen's advice now having told Payplan I am probably going to go BR...

peachyprice

dvs wrote: »

Hi peachyprice

I'm surprised that is the case as it seems a little unfair on creditors that they might not get any repayment (post bankruptcy) because surplus income is being used to repay the capital on a mortgage. (Not saying that you are wrong but it does surprise me!) Does this mean it's more likely that the OR may want you to sell the house to reduce your outgoings?

As mortgages and secured lending aren't included in BR, the OR cannot determine how you pay them.

However, from the OR's point of view, if you carry on paying your repayment mortgage you are infact increasing the equity available to the OR when the time comes to sell, so although you may not pay so much in an IPA, they will get it back if the house has to be sold.

Obviously in the current climate this is not working in the OR's favour, but when the economy is more stable it certainly does.

The kind of mortgage you are paying will make no difference whatsoever as to whether the OR will want to sell your house or not to reduce your outgoings.

dvs

Well that seems good news for sieve then but not good news for creditors! :j