Considering Bankrupcy

Falze

Myself and my partner are probabley having to petition for our own bankruptcy, as we have been told that an IVA is not an option for us, due to our low disposable income. We owe currently £30,000 and have less that £200 available as disposable.

In order for us to apply for bankruptcy we will need to ask family to pay the approx £1000. If bankrupcy is denied, is this refundabl ? Do applications regularally get denied ? I would hate to obtain this money for no reason. All advise we have received has suggested bankruptcy is our option, but i'm abit paranoid over it being declined.

Would we go in together or seperate ? How does the court system work ?

Also we own our property with our 2 girls, but this is in negative equity by approx £25,000 assuming my correct valuation on the house and inlcuding secured loans.

I understand that we should be able to keep the house, if we can still afford the payments, as it has no finacial use to the OR. Has anyone been in the same situation or can advise.

I have never missed a mortgage payment or an secured loan payment.

dojoman

Falze wrote: »

Myself and my partner are probabley having to petition for our own bankruptcy, as we have been told that an IVA is not an option for us, due to our low disposable income. We owe currently £30,000 and have less that £200 available as disposable.

In order for us to apply for bankruptcy we will need to ask family to pay the approx £1000. If bankrupcy is denied, is this refundabl ? Do applications regularally get denied ? I would hate to obtain this money for no reason. All advise we have received has suggested bankruptcy is our option, but i'm abit paranoid over it being declined. Very rarely, as long as you are insolvent there should not be a problem.

Would we go in together or seperate ? How does the court system work ? My wife and I were in the same room when the clerk went through our papers but he went through them individually. We saw the Judge which lasted about 3 minutes together.

Also we own our property with our 2 girls, but this is in negative equity by approx £25,000 assuming my correct valuation on the house and inlcuding secured loans.

I understand that we should be able to keep the house, if we can still afford the payments, as it has no finacial use to the OR. Has anyone been in the same situation or can advise. That is usually the case.

I have never missed a mortgage payment or an secured loan payment.

Hope this helps?

Falze

Thanks Dojoman,

I did read somewhere that if the mortgage and secured debts are more that 40% of you income you are NOT allowed to keep the house as it is classed as unaffordable.

Have you heard of this ?

IF

Hi and welcome Falze.
Firstly Make a list of all your creditors, debts, assets.
Secondly and most important is contact one of the following debt charities:-

Consumer Credit Counselling Service - Website: CCCS Telephone: 0800 138 1111
National Debtline - Website: National Debtline Telephone: 0808 808 4000
Citizens Advice Bureau - Website: Citizens Advice or visit your local CAB centre (find nearest)

Please try these they don't charge and are impartial, try at least two.

Dojoman has answered your questions, any more questions ask away.

take care
Ifwishes...

dojoman

Falze wrote: »

Thanks Dojoman,

I did read somewhere that if the mortgage and secured debts are more that 40% of you income you are NOT allowed to keep the house as it is classed as unaffordable.

Have you heard of this ?

Hi Falze, can`t say I have ever heard of that, hopefully someone will be along who can answer that fro you.

Falze

I am about to take out a cashminder account with co-op as my bank is someone i owe money to.

I understand that an OR would not freeze this accouont if we went the BR route.

I assume i would still be able to use this account for gas / elec / mortgage ect and get my wages paid into their to live off.

i just read that accounts get frozen and i thought how am i going to feed my kids !!!

dojoman

Falze wrote: »

I am about to take out a cashminder account with co-op as my bank is someone i owe money to.

I understand that an OR would not freeze this accouont if we went the BR route.

I assume i would still be able to use this account for gas / elec / mortgage ect and get my wages paid into their to live off.

i just read that accounts get frozen and i thought how am i going to feed my kids !!!

My account (cashminder) was never frozen, as long as you are not in Brighton your cashminder account will be fine. I pay all my DD`s from this account exactly as I did with my other account pre BR.

Falze

Why Brighton ??

dojoman

Falze wrote: »

Why Brighton ??

For some reason the OR in Brighton closes the account and makes you open a new one, don`t know why but it is only in Brighton.

ontheroad_2

Hi Falze,

I will be going BR with my husband at the same time, we are just in the process of saving up for the fees. We are doing this by not paying any of our creditors (but keeping everything else, mortgage, insurances, utilities etc fully paid and up to date). It may take a while, but we'll get there.

As you want to keep your house, you will have a further £200 ish to pay in solicitors fees to the OR once you are BR, if your house is still in negative equity when you get the option from the OR to buy back the Beneficial Interest in your home. So thats another expense you'll need to budget for.

Good luck with it all.

Falze

After taking further advises bankruptcy is our best option. We are now considering not keeping the property, as we would be better off renting. We are currently on interest only and when the secured loan is taken into account we will be £250 a month better off to rent. (without Buildings Ins & any buildings maintence to take into consideration.

A;though we are obviously attached to our house, it feels like a noose around our neck and a complete fresh start would be best.

A perfect rental oppertunity has opened up and they are happy with our circumstances (subject to depoist).

Can i move out of the house and stop paying the mortgage and secured loan and start renting. The house would obviously be repossessed in time or do i hand back the keys.

When is the best time to go BR ? When we move out or when the house is repossessed and the mortgage / secured loan shortfall is asked for.

If we declared bankrupt at the time of moving out, would the Mortage shortfall still be included in the BR, despite us only probabley being 1 payment behind.

Please help and advise what you think is the best way to handle this ?

Falze