£40k negative equity...husband leaving..HELP!

sickofitall_3

Thanks for that. I did all you said 18 months ago. I have listed all the debt seperately. I have been dealing with my own creditors and had 2 cards and 3 catalogues successfully wiped off so yto speak. I am dealing with the others too. I went to CAB and asked about bankruptcy etc and they still havent got back to me. In fact, at the meeting i knew more about it htan there so clled bancruptcy expert! She said she would look in to what i told/asked her nad get back to me, after leaving her 2 messages she still hasnt done that.

I have got copy 'signed' agreements from 3 cards, so, they have been audited and deemed unenforceable so the solicitor acting on my behalf for these is dealing with them now. She is confident to clear them soon.

this still leaves me with the house debt, and not knowing what to do. if he goes bankrupt while he is still on this mortgage...what happens!

thakns

itsakidsworld

Maybe try a solicitor who will work with clients on legal aid? Only a suggestion because as a joint owner of the property, he is as responsible as you are for any debt and if that section cannot be serviced then the company who are owed the money can act as they see fit to recover their money. It looks difficult to have the mortgage in your name only as you cannot produce any sustainable income so try to se it as if you were in their shoes. To continue as you are with your husband on the mortgage is a very dangerous situation and needs re-addressing asap. Have you made an appointment with your lender to see where you stand?

sickofitall_3

thanks

our lender has been ok as far as him losing the business and me being on ESA, they have allowed us to pay reduced payments and now the social is paying the majority of the interest with him being on Jobseekers allowance, but this will only be for maximum of 2 years, hopefully he has either found work or moved out before then anyway. I could ask them about taking his name off but i doubt they will. I know that if i was alone in the house the ESA would pay the interest on it for ME indefinately which is good, but if his name is still on it maybe they will only pay my share rather than his too. will ask them. The difficult thing is that he is still in the property. we get on fine, as fine can be cos of the kids. i have heard about buying out the beneficial interest if i was to go bankrupt, for £1 plus solicitors costs of around £220, but not sure how this works.

thanks

laurel7172

I really don't know much about these things, but if you both want to get him off the mortgage, then doesn't it all transfer to you anyway if HE goes bankrupt? Joint and several liability? Then, once the mortgage was yours, you could make your own decision whether to go bankrupt or not.

There are probably about a hundred reasons why that wouldn't work, and I'm sure somebody will come along and tell us what they are. But it was a thought in passing.

sickofitall_3

haha, thanks Laurel!

it is all so confusing.the way i understand it, is that if he went bankrupt, i 'coulc' or a family member could buy out his share of beneficial interest for the £1, that is so that at the end of his bankruptcy, any equity in the house...his hsare...couldnt be touched as it no longer belongs to him. not too sure, keep getting mixed replies from here, citizens advice etc. it is interest only so at the end of the term i have no way to pay it off, but if i could keep hold until there is some equity in it then sell, that would be better all round.

thanks again for your thoughts!!

sickofitall_3

Right, I now have heard from CAB who spoke to an Official receiver off the record. They say, that because the house is in massive negative equity, they would allow his beneficial interest to be bought out for £1 plus solicitors costs of around £200. I the lender allows his name to be taken off that is. I would have to show tha ti and the beneficial interest owner could afford the mortgage. We now have had £26k charge put against the house by his old business overdraft. Not happy. They said they will not force a sale but put it on the back end of the mortgage, so should we ever sell and there is equity, they will take 50% of the equity, his share in other words. Even if it is only £10k, not the full £26. they wont touch my 50% of any equity whenever we sell. SO, my question now is, if someone buys out his beneficial interest, will that rid the property/mortgage of the charge as it is against HIS name at the property and originally taken out at a different adress anyway i just realised. hope i am making sense!

gizmo111

My understanding is that secured loans/charges cannot be included in BR. Buying the BI is just a paper exercise as there is no equity but means he has nothing to give by way of equity to the OR.
It is unlikely that the mortgage co will release him, and as you say I'm not sure if benefits will pay all the interest on a joint mortgage. You need some proper legal advice to weigh up your options. You may be better off letting the house go and renting.
How old are the children and how much is your own personal debt?

sickofitall_3

I have been trying for nearly 2 years to get sound advice on all these matters. The truth is, nobody I have spoken to, including citizens advice or a bankruptcy specialist, seem to know what to do. The only advice i am getting is as you say, let the house go and rent. But the thing is there MUST be options to avoid this! The kids are 14 and 10. I have around £25k in my name seperate from the mortgage. I am dealing with this via a solciitor and it looks promising. My theory is, if i can buy out his BI, thus avoiding the charge on the property, then he goes bankrupt and moves out, I should be able to afford the mortgage, once the lender looks into re-writing the terms, IE: loan modification due to extreme change in circumstances. I can then continue to pay the mortgage and deal with my own debts with neither the charge owner nor the bankruptcy on his part affecting me and my interest in the home. Does that mak sense!! until i have exhauseted, and i mean EXHAUSTED all options, I will not give up the house so easy. If it was down to me and my errors, maybe i should hold my hand up and say i overspent etc and walk away, but i have put so much int o the home and knew nothing of the state of finances that i want to try my best to hold onto it anyway i can!! thanks x

gizmo111

I can see your point, but I think you will struggle to get his name off the mortgage. What is he proposing?
Have you checked the benefits if you are seperated to pay the interest on the mortgage?

sickofitall_3

Hi, the lender said it is possible to take him pff, we need to apply for this, i guess to show that me or me and the new BI holder can afford the payments. The benefits agency told me they would indefinately pay the interest with me being on ESA, now whether or not that is the whole amount if his name remains on it i am not sure, so i will check. thankyou!