Bankruptcy and disabilities

Sappho

We are seriously in debt , about 70,000+ which includes 50,000+ secured on the property, one of which is welcome finance which refuse to respond to our requests to contact us.We started off borrowing 10,000, paid off 5,000 but now owe over 35,000.
My question is this, the house in in my husbands name , I am a full time carer for my husband who is severely disabled, and we have four children, three of whom are also disabled and I care full time for them all.
Will we loose our home given that I care full time for my disabled husband and children? There would only be about 30,000 left once welcome, the first mortgage and the other charging order is paid off.
I recieve carers allowance and the children and my husband get dla.
Any advice greatly appreciated as I have to do all this on my own :>)

nervousmother

Can you afford to pay your mortgage and the secured loans?
is there any equity in your property?

peachyprice

Hi Sappho,
If you/your OH are considering bankruptcy the secured loan and charging order will not be included. If you want to keep the house you will have to be able to afford these payments.

There would only be about 30,000 left once welcome, the first mortgage and the other charging order is paid off.

Are you saying there is £30k equity once the mortgage, CL and CO are paid, it's not too clear from your above post? If this is the case and your OH goes BR the OR will want the £30k, or an offer towards it, or the house will have to be sold.

HTH

Sappho

We can afford the mortgage and we are up to date. We cannot afford the Welcome secured loan and havent paid this for four years as it is contested ( Welcome will not respond to our letters). We pay a nominal fee off the charging order which keeps the wolves from the door. There would be 30k+ left in equity on the house once the charging order, secured loan and first mortgage is paid. So even though I care for three disabled children and my disabled husband they would still throw us out of the house? That is scary :>(

Tinytim

Hi Sappo,

The first thing to say is it is absolutely essential that you contact one of the bedt charities to get free, impartial advice on what your options are. The three main one are CAB, National Debtlene and CCCS, and the sticky thread towards the top of the board has details of how to contact each.

Bankruptcy is a very serious step, and should always be a last resort. It provides a solution whereby an individual who is burdened by unresolvable debt problems can draw a line and start again. In the same way that when a person dies, what they leave behind is called their estate, when a person declares BR, they give to the OR their bankruptcy estate. Therefore, all of your assets (with a few exeptions, such as tools of a trade) become the property of the OR, whose job is to realise those assets and pay of your creditors, and yes, this includes the value of the equity in your home as well. In normal circumstances you would be allowed a minimum of a year to find alternative accomodation, but with equity of £30,000, the OR would have little choice but to eventually realise this.

However, from what you have said, it does not initialy appear that you are bankrupt on an assets and liability basis, and therefore the solution could be less drastic than BR. Unless I have missunderstood what you have written, it seems that you have unsecured debts of £20,000 and equity in your home of £30,000. In this instance, the simplest solution would be to simply sell your home and move into rented accomodation, and have the remaining £10,000 as a financial cushion. This way your would avoid all the costs and dissadvantages of bankruptcy, but end up in the same eventual place as you would do if you declared BR.

peachyprice

Sappho wrote: »

We can afford the mortgage and we are up to date. We cannot afford the Welcome secured loan and havent paid this for four years as it is contested ( Welcome will not respond to our letters). We pay a nominal fee off the charging order which keeps the wolves from the door. There would be 30k+ left in equity on the house once the charging order, secured loan and first mortgage is paid. So even though I care for three disabled children and my disabled husband they would still throw us out of the house? That is scary :>(

Thanks for the clarification. I agree with Tinytim, BR isn't going to help you really as there is no way you can include the Welcome loan and the charging order in BR unless you allow the house to repossessed. And you are infact not insolvent while you have more equity than your debts.

The fact that you have disabled children and husband will make no difference as to whether you can keep the house, the OR/trustee will want the equity one way or another.