Calling all bankruptcy wise owls - newbie/long time lurker needs help :)

mummybiz5

Hoping I can benefit from the amazing support and advice you guys give on here - brief outline of our situation. In dmp with cccs for 18 months with OH - debt currently £58,000 paying £702 a month. WE have 5 children - OH has permanent professional jopb earning good salary but I have given up work as teacher due to new baby and needing to home ed two children with sen issues.

• our house is worth around £140000 max with mortage of £130000 on Northern Rock svr which no doubt will rise in the next few months
• Mortgage is in OH name only but I have beneficial interest
• OH wants to leave house via voluntary reposession and rent somewhere bigger ( which will cost the same but have more room as rents are low here compared to our mortage cost)
• He wants to file for bankruptcy - we are really struggling on our dmp and cccs are not very receptive to changing amount - we also think Yorkshire Bank will go for charging order on house as are the biggest creditor
• The debts are split 50/50 half of them are in my sole name and half in his - we are on a joint dmp and I pay £182 Oh pays £520 so he is paying towards my debts - if he gopes bankrupt I will only have £182 to offer my creditors and a hugely extended dmp

Questions?

• If we stayed in the house and went bankrupt My OH is likely to get an IPA - we know our mortgage payments will rise -can the IPA be varied to help with increased mortgage costs?
• If we tell the OR we don't want to keep the house or the OR decides the house needs selling we he let us stop paying the mortgage to save for a rental deposit
• Lettings agents approached say will help but want between 3 and 6 months rent up front or a guarrantor - if we decide to move prior to bankruptcy we will stop paying mortage and dmp to get money together - how long before Northern Rock throw us out ?!
• My only income is child benefit and tax credit - would I get an IPA?
• OH will go bankrupt first then I will go next after saving fees - should I make token payments to my creditors and should I tell them I am going bankrupt?

Sorry for the essay - I have learnt so much from reading the posts on here - you guys are wonderful hoping you can clear a few things up for us !

Many thanks in advance x

Tupperware_Queen

mummybiz5 wrote: »

Questions?

OK, not an expert, but my thoughts are:

• If we stayed in the house and went bankrupt My OH is likely to get an IPA - we know our mortgage payments will rise -can the IPA be varied to help with increased mortgage costs?

IPA is an agreement - so you can negotiate - and it can be reviewed if circumstances change

• If we tell the OR we don't want to keep the house or the OR decides the house needs selling we he let us stop paying the mortgage to save for a rental deposit

not sure about after BR - but I did this pre BR and OR was fine with that - they do understand

• Lettings agents approached say will help but want between 3 and 6 months rent up front or a guarrantor - if we decide to move prior to bankruptcy we will stop paying mortage and dmp to get money together - how long before Northern Rock throw us out ?!

I have not paid mortgage for 6 months, moved out almost 5 months ago - still just getting the 'you have missed a payment' letters - nothing more as yet!

• My only income is child benefit and tax credit - would I get an IPA?

unlikely

• OH will go bankrupt first then I will go next after saving fees - should I make token payments to my creditors and should I tell them I am going bankrupt?

don't bother with token payments, and don't tell them, they will just up the ante in terms of calls etc

Sorry for the essay - I have learnt so much from reading the posts on here - you guys are wonderful hoping you can clear a few things up for us !

Many thanks in advance x

Like I say, I'm not an expert - but didn't want to read and run

mummybiz5

thanks - great advice already - this forum is keeping me sane

Tupperware_Queen

I think the general consensus is that you are better to move into rented before the B R if its possible.

good luck xx

HOLIDAYMAD_2

Calling all bankruptcy wise owls - newbie/long time lurker needs help

Hoping I can benefit from the amazing support and advice you guys give on here - brief outline of our situation. In dmp with cccs for 18 months with OH - debt currently £58,000 paying £702 a month. WE have 5 children - OH has permanent professional jopb earning good salary but I have given up work as teacher due to new baby and needing to home ed two children with sen issues.

• our house is worth around £140000 max with mortage of £130000 on Northern Rock svr which no doubt will rise in the next few months - 10 k equity would be of intrest to the OR, but it will take some time,
• Mortgage is in OH name only but I have beneficial interest - that would be for the OR to determine and decide on, would take a bit of time though- cert time to buy you time for rental saving.
• OH wants to leave house via voluntary reposession and rent somewhere bigger ( which will cost the same but have more room as rents are low here compared to our mortage cost) - northern rock will prob work with you it takes time , but with CAB i think you could stay put, however rental is your choice. walking away means your still liable for all the costs inc squatters , damage etc until its repossed and only BR would wipe that, personally id stay and save for rental.
• He wants to file for bankruptcy - we are really struggling on our dmp and cccs are not very receptive to changing amount - we also think Yorkshire Bank will go for charging order on house as are the biggest creditor - yorkshire can only go for a CO if you have not met the terms of the CCJ , they can not get a CO before a CCJ, if you have met the terms of the CCJ, that is good defense ground . If he went BR , then you can think out your choices, BR is a good option but if debts are 50 /50 id do it seperately with the person that has the higher debts and more pressure being put on for a charging order.
• The debts are split 50/50 half of them are in my sole name and half in his - we are on a joint dmp and I pay £182 Oh pays £520 so he is paying towards my debts - if he gopes bankrupt I will only have £182 to offer my creditors and a hugely extended dmp

Questions?

• If we stayed in the house and went bankrupt My OH is likely to get an IPA - we know our mortgage payments will rise -can the IPA be varied to help with increased mortgage costs? yes you keep them informed
• If we tell the OR we don't want to keep the house or the OR decides the house needs selling we he let us stop paying the mortgage to save for a rental deposit OR wont be intrested in you paying or not paying mortage, only intrested in equity if he forces sale, your choice to pay or not. but could take it as surplus
• Lettings agents approached say will help but want between 3 and 6 months rent up front or a guarrantor - if we decide to move prior to bankruptcy we will stop paying mortage and dmp to get money together - how long before Northern Rock throw us out ?! months imo , ive seen it as long as 18 months, got to get the possession order first. agents can ask up to the full tenure in advance and then again on the renewal, look for a private landlord and not a agent.
• My only income is child benefit and tax credit - would I get an IPA? you have to declare your husbands income as your household expense. so prob yes
• OH will go bankrupt first then I will go next after saving fees - should I make token payments to my creditors and should I tell them I am going bankrupt? do they have ccj in place etc, i didnt pay mine a bean for years , some got charging orders but funny enough the big ones gave up , yes they ccj but pursued further, im prob in a backlog of others.
• your not commited by law to stick to that DMP either, so really doesnt matter who goes first, id say go with the one that having the most pressure applied.

mummybiz5

If we have decided we don't want to keep the house is it really best to leave before bankruptcy - would the official receiver take as surplus if we saved our monthly mortage payment whilst still in the house after bankruptcy in order to have 6 months deposit? - Is this six months deposit in advance likely to be an ongoing requirement at every reknewal ? How likely are Northern Rock to work with us to keep the house if we are in dmp and our svr mortgage goes up - or can we vary our dmp payment to cover increased mortgage?
Thanks everyone !!

Ineedaname

It's best to move into rented accomodation before BR as obtaining same after can be problematic. Check any new tenancy agreement for any BR clause to be safe.

Stopping mortgage payments in order to save up for moving is acceptable. If you move before BR you shouldn't need 6 months up front unless you have really a bad credit rating already. Is there anyone who could/would guarantor for you? Try to get a 12 month tenancy rather than 6 months if you can, then you don't have to worry about renewal costs. IF you have had to pay 6 months up front then renewal should be straightforward as the agents/landlord will have seen you paying regularly for 6 months, i.e. they would still be holding 6 months deposit.

DMPs are variable according to your income and expenses, but each and every amendment (usually every 6 months unless something changes dramatically in between) needs to be agreed by all creditors.

If you go BR then any surplus is taken by the OR in an IPA (Income Payments Order) and that is also variable.

mummybiz5

Wouldn't our credit ratings be automatically too bad because we have been on a dmp with CCCS - we don't have any ccj's or mortage arrears ( yet ! ) - would you be upfront with the lettings agent - would love to find a private landlord but they seem as rare as hens teeth here in west yorkshire?!

Ineedaname

Your credit file will probably show defaults for a month here or there, but essentially once you're on a DMP it shows payments made on time and recovers a little. That's what I noticed on receiving my files the other day, looked a lot better than I thought.

You can guage the situation with each letting agent or just wait and see what comes back from a check. I think others have managed to rent successfully without too many problems in your situation.

HOLIDAYMAD_2

ineedaname can i ask what your are repaying each month and for how long , my husband is thinking of a DMP, what im eager to know is if your accounts have been defaulted which whey will have been how your credit ref doesnt show default status, for me DMP is just a way of dragging the poor credit ref onwards etc and into years.

To the OP ,i would never ever just walk away from a mortaged prop , go back to the lender and tell them the suitation, also get CAB to represnt you , look at many options first,

Private renting is a gamble you never know.

Ineedaname

Holidaymad - my personal circumstances are just that, mine, and what I have been paying won't relate to somebody else's income and expenditure. A DMP was right for my life circumstances at the time, I am now in a position in life to go BR. There is a lot more to going BR than just being insolvent, especially when you have health problems.

Yes, my accounts are showing as defaulted on my credit files and I apologise to the OP for misinformation in post #9. What I meant was that there may be a D showing here and there in payment history, relating to then saying paid on time. However, I have recently had a credit check for a new mobile contract and it went through fine, I'm guessing on the basis of "paid on time" records even though accounts are defaults. Hence trying to reassure the OP that it's better to rent before going BR as once that is showing on the records renting a new place is very difficult.