bankruptcy help very worried...

arghhh

car aside i think we have resigned ourself to the fact that we will most prob loose that

the house is my main worry, i don't know how to work out/find out how much it is actually worth without ringing and getting someone to come and value it, i believe we are in neg equity from what house prices have gone for round here but then the last house sold here was in may 2010 then the one before that was for considerably more (40k more) in 2008 there is one on the market now for 5k less than what we have outstanding on our mortgage (so its cutting it quite close), has been on the market a while tho

arghhh

kepar wrote: »

i have just read on the forums the 'what happens to my car' section from reading that i'm pretty sure we would loose it, but it says you can buy it back.... our car is a 99 v reg, bit rusty in places currently no MOT (due to be fixed on friday thanks to a family member) do i delay the repairs so therefor the car is non useable and we would be able to 'buy it back' at a reduced cost? or have i mis understood that

i'm asuming then tho, we wouldn't be able to get the car repaired or drive it for the 3 years?


The OR probably will not be interested in the car, but may not allow the allowances for it. This means you won't have an allowance for fuel. insurance etc. If you want to run the car you will have to find the money within your other allowances.
You are only br for a year, only if you get an IPA would your SOA stand for thee years. In that time your circumstances may have changed. If you can avoid an IPA you will be free after a year. To be honest the OR will probably not accept your needing a car for school runs etc.

so if we dont get asked to pay an IPA then the house wouldnt be revalued again in 2 years 3 months? and when its discharged that would be the end of it? sorry i was under the impression that they could come back to you at any point in those 3 years

debtinfo

arghhh wrote: »

is it right (from my understanding) that aslong as we are in negative equity we CANNOT loose the house? even at the 2 years 3 month stage if we are still in negative equity they wont ask us to move out?

This is one of the more complicated bits of bankruptcy.

You need to understand the difference between the law and what the OR's own guidance is. You also need to understand that you might not get the OR as trustee you might get an IP instead, Both the OR and an IP have to work within the law, IE they cant be harsher than the law but sometimes choose to be less harsh than the law allows.

So the Law is as follows. When you go bankrupt your interest (ie your right to future sale proceeds in the house) automatically transfers to the trustee (OR or IP), thats it gone. Now the trustee can hold that untill they can do something with it, they can sell the property to a 3rd party, they can sell the interest to you or family/friend or they can apply to put a charging order on the property for the value of the equity (so no equity no charging order). Now the trustee has those options available to them but will only do something if it is economically viable, ie it costs to get a charging order or to sell the property and so they cant really do this if there is no equity. If they do nothing then they hold onto those rights for 3 years (so as to allow equity to build up) so they could exercise those rights any time in the 3 years if it does get to be in an equity position.

Next lets presume that after 2 years 3 months there is still no equity, Now the OR's CURRENT guidance (not the law) is that they will start the process to hand your interest back to you for free.

fast forward to 3 years, If there is still no equity and so the trustee has not been able to do anything to realise the interest then that is the legal point where it will automaticaly by law come back to you, that is the safe point so to speak

arghhh

is that how it works if as previously mentioned we dont have to pay an IPA? or is that the general ruling for the house but for all other things it would end after the year if we hadnt got to pay the IPA?


think i'm confusing myself more....arghhh lol

debtinfo

dont worry, ask as many questions as necessary, the first thing to get your head around is that there are different rules for different assets. those are the ones that apply to houses, it is different for cars, IPA's and other assets, dont try to connect them

arghhh

oh dear

ok household assets, what are they going to take from me (if anything), what will they look at or consider taking?

arghhh

i've been told.... which i now wonder if its true... that if any ONE item that we own is worth more than £1000 they will take it to sell, anything that is not worth £1000 or would not fetch £1000 at auction they wont bother with?

debtinfo

arghhh wrote: »

oh dear

ok household assets, what are they going to take from me (if anything), what will they look at or consider taking?

Household items that are of reasonable value are all exempt from the bankruptcy as long as they are needed for your reasonable (not basic) domestic needs.

Now i used the reasonable word twice there so i will explain that a bit more.

Reasonable domestic need - that pretty covers everything in a noramal household - furniture, kitchen equipment, personal electronics etc. they use reasonable because say you had 12 tv's in your house they would say that was not reasonable and probably take 10 of them. In reality 99% of people do not have anything taken from their house.

Reasonable value - again what would normal pople have in their house, If you have a real picasso on the wall that will be going, if you have a copy print of a picasso then that can probably stay. A common guide (but not a legaly binging one) is that anything that would sell second hand for less than £1000 is generally considered safe

arghhh

phew, i think we are ok on the assets side then i cannot see anything that would fall in the the 'reasonable value' category and we certainly dont have 12 tv's (we do have 4 tho) one in each of the bedrooms 'portable ones' and then one downstairs lol

car wise, if he decided we can keep it but wont allow the expenses on the SoA for it does that mean we aren't allowed to use it or would it be a case of if you spent £20 less on food one week you could put that in for petrol and use it kinda thing, not sure how you'd get around car insurance tho as thats a monthly payment anyway. i think we have resigned ourself to the fact that it may end up going or being 'un-useable' due to costs and allowances issues

debtinfo

One thing to clear up, is that the OR wont be sitting there looking at your bank statements telling you of for using slightly less on your housekeeping and slightly more on fuel. The OR wants you to look after and care for your own finances, they are not there to babysit you. What they do is make certain allowances based on your circumstances and take the rest (if there is any via an IPA). how you manage your day to day finances after that with the money you are left is down to you