Worried sick and trapped

Alan_Cross

Interesting

Your figures seem to indicate a loan of £222,500, an income from your husband of £17,700 (and a deposit of £12,000).

I assume you have had to leave a very highly paid job..?

Down_but_not_Out_2

Conrad wrote: »

This is not advice, merely a comment;

Bankcruptcy can be a life safer. I've seen enough over the years as a broker to know this. Forget IVA and debt managment plans - it's all muppetry (and earns commisions for third parties - unlike bankcruptcy).
Having an IVA or DMP / arrears etc puts you in a worse position thatn bankruptcy as those debts can carry on for years, even decades so you never get free of the bad debtors label. People come to me with DMP's that are 5 years old, and I cannot get them a mortgage, where as a 5 year old bankcruptcy would present much less of an issue.

Bankcruptcy is no worse than a DMP or IVA in the eyes of a future lender. You will be discharged usualy after one year anyway.

It means all debts will go away at a stroke.

......

Your decision, but beware all the muppetsa going down the DMP / IVA routes.

This is encouraging stuff as I have decided to file for BR rather than try another route.

I have mortgage arrears and my home is in negative equity. Is it better to stay put and clear the arrears in the hope that I will be better placed to get a mortgage in the future? I should have a record of satisfactory payments and have lost the negative equity by then. The alternative is to hand back the keys and rent for a while. My current lender says that they will not give new loans or further advances to those that have been BR at any time (even if I keep the payments up and clear the deficit).

How tough would it be to get a future mortgage elsewhere and which "history" would help me more?

Alan_Cross

I would recommend attacking the problem from every angle you can think of IF you want to try to weather the storm:

* Approaching Accord AND the Citizen's Advice Bureau

* Increasing current income - Can you actually do any kind of home work over and above ebaying? Can hubby get any kind of weekend or evening work? Help from friends/relations?

* Reducing current outgoings - Check out the 'debt free' board, as mentioned. Do a total and ruthless budget check and get rid of anything which is not in the food/shelter/warmth bracket. A good time to give up the booze and fags. Then, see if you can't reduce the food/warmth expenses in some way. There is a lot to be said for putting on extra layers rather than cranking up the gas. There are amazing numbers of people who do not realise that you can feed a family of four for £20/week.

If all else fails or if you prefer to lose both the house and your credit rating rather than go through this pain, by all means go down the bankruptcy route as described by Conrad above. You will find yourself living in rented accommodation but the End of the World this is not. Most of Europe does it.

Whatever you decide, try your best NOT to default on payments to Accord before you approach them and give warning. The latter will at least show that you are not an irresponsible person.

annie46abbie

Alan_Cross wrote: »

Interesting

Your figures seem to indicate a loan of £222,500, an income from your husband of £17,700 (and a deposit of £12,000).

I assume you have had to leave a very highly paid job..?

Hi no,
the mortgage was £153000
the interest i believe was 5%
the deposit was £10000
my hubby has annual income of £23000
i had £11000 income

Alan_Cross

annie46abbie wrote: »

Hi no,
the mortgage was £153000
the interest i believe was 5%
the deposit was £10000
my hubby has annual income of £23000
i had £11000 income

Apologies.

I notice belatedly that you are on a repayment rather than interest only basis, which makes a huge difference, possibly £200-£300 monthly.

It would definitely be worth your while asking Accord to vary the terms such that you pay interest only, if only on a temporary basis. Hinting that the alternative may have to be bankruptcy might work wonders... this is something the CAB may be able to advise you on.

PasturesNew

Alan_Cross wrote: »

...an income from your husband of £17,700

With a takehome of £1475, I make that an income of £23,000

annie46abbie

Alan_Cross wrote: »

Apologies.

I notice belatedly that you are on a repayment rather than interest only basis, which makes a huge difference, possibly £200-£300 monthly.

It would definitely be worth your while asking Accord to vary the terms such that you pay interest only, if only on a temporary basis. Hinting that the alternative may have to be bankruptcy might work wonders... this is something the CAB may be able to advise you on.

Thank you.
It would be a huge relief if we can avoid bankruptcy, wish we had not taken the 10 year fixed rate now, bt as i say it was the only option available to us at the time. Many thanks for your advice