advice please guys ! I'm so so so confused

Mr_Crow

hi all
After fighting on for the last 6 months or so with a DMP sorted out by PayPlan , who have been quite helpfull , my wife has just been made redundant so thats only my wage coming in and quite frankly we got NO CHANCE , Anyway, we are in debt to the tune of around £70K , our house is in negative equity , we are a couple months behind with the mortgage , the DMP has now failed and PayPlan are now making a token payment again to all creditors so we are now back to the same point we were six months ago.
The mortgage company have been very good , we are currently paying half mortgage for 3 months Approx £600 per month.

My SOA is showing a negative now and i think i have no other route now but to declare myself Bankrupt.

my questions are .

1, We are currently on a tracker mortgage and with the base rate so low,if i was bankrupt , we could afford the mortgage if we had no creditors to pay but if the mortgage rate jumps then we would struggle to pay , Should we include the mortgage in our bancruptcy ? what happens if we keep the house , go bankrupt , then cant afford the mortgage when the rate goes up ?

2) What allowance does the OR allow for property rental , we live in the west country where rental is expensive , 3 kids , approx £1200 per month (more than the mortgage at present)

3) who should be my first port of call for advice ? i dont know who to ask and apart from this forum , which is brilliant , i dont know who to talk to about our situation ? Payplan although helpfull , dont seem to offer much advice on bankruptcy , they just help with your IVA or DMP



to sumorize

£70k debt
No left over money
Family starting to suffer
About £100k negative equity
Absolutely no idea what to do next

Please Please Please , any advice would be a great help

thank you in advance people

fiveyearplan

Mr_Crow wrote: »

hi all
After fighting on for the last 6 months or so with a DMP sorted out by PayPlan , who have been quite helpfull , my wife has just been made redundant so thats only my wage coming in and quite frankly we got NO CHANCE , Anyway, we are in debt to the tune of around £70K , our house is in negative equity , we are a couple months behind with the mortgage , the DMP has now failed and PayPlan are now making a token payment again to all creditors so we are now back to the same point we were six months ago.
The mortgage company have been very good , we are currently paying half mortgage for 3 months Approx £600 per month.

My SOA is showing a negative now and i think i have no other route now but to declare myself Bankrupt.

my questions are .

1, We are currently on a tracker mortgage and with the base rate so low,if i was bankrupt , we could afford the mortgage if we had no creditors to pay but if the mortgage rate jumps then we would struggle to pay , Should we include the mortgage in our bancruptcy ? what happens if we keep the house , go bankrupt , then cant afford the mortgage when the rate goes up ? I wouldn't include mortgage in the bankruptcy just yet. If (and when!) the interest rates go up and if you cannot afford the mortgage at that time you can include it then. Your circumstances may improve by that time whereby you could afford it. In any event you don't have to make that decision just yet but I would try and stay on top of it and stop paying everything else.

2) What allowance does the OR allow for property rental , we live in the west country where rental is expensive , 3 kids , approx £1200 per month (more than the mortgage at present)OR allows what is normal for the area. Since your mortgage is cheaper it makes sense to stay for the time being.

3) who should be my first port of call for advice ? i dont know who to ask and apart from this forum , which is brilliant , i dont know who to talk to about our situation ? Payplan although helpfull , dont seem to offer much advice on bankruptcy , they just help with your IVA or DMP
Contact CCCS, CAB and National Debtline (in no particular order!) and keep reading this forum from top to bottom to get as much information as you can. Keep asking questions!



to sumorize

£70k debt
No left over money
Family starting to suffer
About £100k negative equity
Absolutely no idea what to do next

Please Please Please , any advice would be a great help

thank you in advance people

Welcome to th BR forum. You will get through this. Why don't you pop up your SOA for guidance.

http://www.makesenseofcards.com/soacalc.html

Mr_Crow

hi Fiveyearplan
thanks for such a prompt reply , If i go Bankrupt now and dont include the mortgage then what will happen if i am bankrupt and then the mortgage rate goes up and we cant then afford the mortgage ? i am very confused about this , surely the motgage company will want there money back and as im in negative equity they couldnt sell my house and get my money back

Angiepange

Hi

In similair situation this advice from peachyprice to me really helped

Take care

Angie x

Quote:
Originally Posted by Angiepange
Hi MCT,

if you stay in home and then have to move out further down line and bank sells at a loss ie would shortfall only be included while you are BR and not after discharge?


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.
From here:

http://www.insolvency.gov.uk/faq/faq.htm#16

longshot

Mr Crow, when i look at your situation, it makes my mess look positively better.

your story is the stuff thats gripping the country right now. hence the fact i always downgrade when buying a new place not upgrade.

at the end of the day try and keep your health and you can't buy that with money
(not easily)

sorry to hear you tale of woe but were all in the same boat...

Miss_Poohs

No advice from me either Mr Crow, but it all looks very familar.

Take care

Miss P

Mr_Crow

Hey Guys
Been on the phone the whole week (well seems like it) and i just cant seem to get a straight answer from anyone , the burning question , "If i go Bankrupt and dont include my mortgage , what happens if (WHEN) the Mortgage Rate goes up and i cant afford my mortgage while I am Banckrupt ?"
It seems such a straight forward question but i just cant get a straight answer.
By The way , My Mortgage is the only secured debt i have ! it is also the only debt i have that is in joint names with my wife , not sure if that helps ?
Please , any info would be so appreciated
thankyou

tigerfeet2006

If you can't afford the mortgage when it goes up and you are BR hten you move into rented, let the mortgage company reposess, they sell the house, the shortfall will go into your BR even if you are discharged by the time it is sold.

Mr_Crow

Hi Again Guys
I thought i might brighten up some of your afternoons and post my SAO on here , Jesus H !!! it looks even worse on paper.I dont think i have seen a lot worse on here.
Some of the card debts are tied up in my company , i am a director of a LTD company.I am currently in a DMP with Payplan which is going to fail this month as my wife has just been made redundant hence the big fat '0' in partners earnings.
Anyway it makes for some interesting reading.Any comments on which way to go next would be much appreciated.

Statement of Affairs and Personal Balance Sheet
Household Information
Number of adults in household........... 2
Number of children in household......... 3
Number of cars owned.................... 0
Monthly Income Details[/b]
Monthly income after tax................ 2600
Partners monthly income after tax....... 0
Benefits................................ 178.85
Other income............................ 0
Total monthly income.................... 2778.85
Monthly Expense Details
Mortgage................................ 1200
Secured/HP loan repayments.............. 100
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 206
Electricity............................. 83
Gas..................................... 0
Oil..................................... 100
Water rates............................. 103
Telephone (land line)................... 30
Mobile phone............................ 30
TV Licence.............................. 12
Satellite/Cable TV...................... 30
Internet Services....................... 27
Groceries etc. ......................... 660
Clothing................................ 80
Petrol/diesel........................... 100
Road tax................................ 15
Car Insurance........................... 25
Car maintenance (including MOT)......... 25
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 25
Pet insurance/vet bills................. 25
Buildings insurance..................... 18
Contents insurance...................... 18
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 10
Haircuts................................ 10
Entertainment........................... 0
Holiday................................. 0
Emergency fund.......................... 20
Total monthly expenses.................. 2952

Assets
Cash.................................... 0
House value (Gross)..................... 400000
Shares and bonds........................ 0
Car(s).................................. 0
Other assets............................ 0
Total Assets............................ 400000

Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 472000...(1200).....3.39 Tracker - Will Go Up with base rate
Hire Purchase (HP) debt ...... 2300.....(100)......9
Total secured & HP debts...... 474300....-.........-
Unsecured Debts
Description....................Debt......Monthly...APR
Barclaycard....................6452.24...0.........0
HSBC Card Services.............9733.77...0.........0
HSBC Bank......................2984.68...0.........0
Marbles Card Services..........6795.4....0.........0
Blair Oliver Scott.............6877.37...0.........0
Westcott Card Service..........4145.61...0.........0
NCO Financial Service..........4662.58...0.........0
Egg Prudential.................9014.81...0.........0
Egg Prudential.................2199.81...0.........0
Egg Prudential.................2493.08...0.........0
Egg............................2320.26...0.........0
Mint Card Services.............6189.84...0.........0
Virgin Card Services...........10560.....0.........0
Amex...........................7000......0.........0
HSBC Bank......................1796.73...0.........0
Total unsecured debts..........83226.18..0.........-

Monthly Budget Summary
Total monthly income.................... 2,778.85
Expenses (including HP & secured debts). 2,952
Available for debt repayments........... -173.15
Monthly UNsecured debt repayments....... 0
Amount short for making debt repayments. -173.15
Personal Balance Sheet Summary
Total assets (things you own)........... 400,000
Total HP & Secured debt................. -474,300
Total Unsecured debt.................... -83,226.18
Net Assets.............................. -155,226.18

philnicandamy

Mr_Crow wrote: »

Hi Again Guys
I thought i might brighten up some of your afternoons and post my SAO on here , Jesus H !!! it looks even worse on paper.I dont think i have seen a lot worse on here.
Some of the card debts are tied up in my company , i am a director of a LTD company.I am currently in a DMP with Payplan which is going to fail this month as my wife has just been made redundant hence the big fat '0' in partners earnings.
Anyway it makes for some interesting reading.Any comments on which way to go next would be much appreciated.

Statement of Affairs and Personal Balance Sheet
Household Information
Number of adults in household........... 2
Number of children in household......... 3
Number of cars owned.................... 0
Monthly Income Details[/b]
Monthly income after tax................ 2600
Partners monthly income after tax....... 0
Benefits................................ 178.85
Other income............................ 0
Total monthly income.................... 2778.85
Monthly Expense Details
Mortgage................................ 1200
Secured/HP loan repayments.............. 100
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 206
Electricity............................. 83
Gas..................................... 0
Oil..................................... 100
Water rates............................. 103 pretty high...OR will ask for proof
Telephone (land line)................... 30
Mobile phone............................ 30
TV Licence.............................. 12
Satellite/Cable TV...................... 30 NOT allowed would have to come from surplus (if any)
Internet Services....................... 27 NOT allowed unless for work/school
Groceries etc. ......................... 660
Clothing................................ 80
Petrol/diesel........................... 100
Road tax................................ 15
Car Insurance........................... 25
Car maintenance (including MOT)......... 25
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 25
Pet insurance/vet bills................. 25 £20
Buildings insurance..................... 18
Contents insurance...................... 18 Does this have accidental accident cover
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 10 usually not allowed but leave it & see
Haircuts................................ 10
Entertainment........................... 0
Holiday................................. 0
Emergency fund.......................... 20 NOT allowed (put this with holiday & increase to around £60-70 ish
Total monthly expenses.................. 2952

Assets
Cash.................................... 0
House value (Gross)..................... 400000
Shares and bonds........................ 0
Car(s).................................. 0
Other assets............................ 0
Total Assets............................ 400000

Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 472000...(1200).....3.39 Tracker - Will Go Up with base rate
Hire Purchase (HP) debt ...... 2300.....(100)......9 whats this HP for?
Total secured & HP debts...... 474300....-.........-
Unsecured Debts
Description....................Debt......Monthly...APR
Barclaycard....................6452.24...0.........0
HSBC Card Services.............9733.77...0.........0
HSBC Bank......................2984.68...0.........0
Marbles Card Services..........6795.4....0.........0
Blair Oliver Scott.............6877.37...0.........0
Westcott Card Service..........4145.61...0.........0
NCO Financial Service..........4662.58...0.........0
Egg Prudential.................9014.81...0.........0
Egg Prudential.................2199.81...0.........0
Egg Prudential.................2493.08...0.........0
Egg............................2320.26...0.........0
Mint Card Services.............6189.84...0.........0
Virgin Card Services...........10560.....0.........0
Amex...........................7000......0.........0
HSBC Bank......................1796.73...0.........0
Total unsecured debts..........83226.18..0.........-

Monthly Budget Summary
Total monthly income.................... 2,778.85
Expenses (including HP & secured debts). 2,952
Available for debt repayments........... -173.15
Monthly UNsecured debt repayments....... 0
Amount short for making debt repayments. -173.15
Personal Balance Sheet Summary
Total assets (things you own)........... 400,000
Total HP & Secured debt................. -474,300
Total Unsecured debt.................... -83,226.18
Net Assets.............................. -155,226.18

just a few thoughts

Kelly0405

just thought i'd leave a quick message. i've been bankrupt since january last year with debts of about 40-45,000. first port of call is definitely the citizens advice. the lady there was so helpful and filled out all the forms for me and explained everything in great detail in terms i could understand. if you claim working tax credit you dont even have to pay to be made bankrupt. my advice is definitely see them first as they will explain all routes open to you.