advise pls

markybriggs

Hi

Ive just found out that my parents are 30 grand in debt !! they are 69 years old and my dad is still working but is desperate to retire. There is no way in this world they can pay this money back. it is all credit card debits. They own a council house worth about 70k and have a mortgage for 20k outstanding. We are thinking of buying there house and taking on the mortgage debt so that they can retire and continue to live in the house rent free but we cannot take on the credit card debts.

My question is if we buy there house for 20k and then my dad declares himself bankrupt to clear his credit card debits, could / would the insolvency practitioner look into the house sale and the possible equity they have.

Obviously they do not want to take on a bigger mortgage to clear there debts otherwise he will be working until he is at least 80 !!

what should we do?

Horace

Hi and welcome

I have no idea about the house so cannot give any advice on that score. Can you post up your dad's SOA so that we can see what debts he has and give advice on how best to clear them? https://www.makesenseofcards.com/soacalc.html (there is a button on there to formulate it to MSE so that you can copy and paste it here).

marfan_not_martian

Hi markybriggs sorry to hear about your parents hope they get it sorted if they phone CCCS I am sure they will get some valuable advice.

With regards to them selling the property to you I think that the OR would definetly look into it as any asset sold at under market value would be of interest to them as potentially if sold for the correct value it could in effect clear some if not all of their debts. I would suggest you take some advice on that too.

markybriggs

how would they know that he sold the house if he told them he is renting the house?

marfan_not_martian

When you complete the bankrupcy forms or forms for an IVA - I am sure that one of the questions asks "have you ever previously owned the property you now rent" - it may also ask about any assets that have been sold in the last few years.

GeorgeUK

They do look back at this stuff mark. Have a look at the bankrupt board and do a search there for selling houses.

Their best bet if they can't afford the repayments is to probably speak to one of the free debt charities.

They may be able to come to some kind of reduced settlement figure if they are not keeping up with the minimum payments or could possibly check to see if the debts are enforcable by requesting copies of the credit agreements. If they are meeting the minimum payments right now though this could be quite tricky.

CCCS, payplan, nationaldebtline and citizens advice may be able to offer more suggestions.

wanna-be-mortgage-free_2

Will you actually hand over £20,000? If so, your dad could ask his creditors to accept a reduced final settlement figure thus paying off the debts.