Debt question

mess

Hi,

Didn't know which forum this would be most suited to, so i've put it in here!

My wife and I are currently 2 months behind with our mortgage and a secured loan, my wife is really struggling with work
(just been told she has osteoarthritis in her back), she's ready to pack it in. We are currently paying £5 per month to all of our unsecured debts, as advised by the CCCS and we are still struggling.

My question is: If we just stopped paying the mortgage and secured loan and moved into a rented house and let the mortgage company repossess,
what would be the outcome? How would they go about it?

House is borderline negative equity, £125k ish, interest only mortgage and the secured loan is for 8k (Welcome Finance)

Unsecured debts amount to around 6k

Any input would be appreciated

dancingfairy

Hmm - it's tricky. Yes you could give it all up and move into rented. By the time mortgage payments are late plus interest and charges, plus repossession fees and possibly not the price you paid for it you'd be looking at owing money when the house is repossed which would possibly lead to bankruptcy, unless of course your rent payments were significantly lower and you were entitled to more in the way of benefits and you could come to some sort of arrangement to pay off the shortfall.
Are you paying 5 pounds per creditor per month or 5 pounds altogether?
I think I'd go back to the CCCS and see what they propose - you really need to find out what the prognosis is for your wife and what benefits she would be entitled to before you make any decisions.
Have you spoken to the bank? perhaps you could try and offer to catch up the missed payments at the end of the mortgage term or spread the missed payments out over a number of months?
I'd redo your budget to see why you are struggling? -is your wife bringing home less due to the illness or have your living costs massively increased recently?
The key really I think is what's best for you wife health wise and what benefits etc she will get and you can take it from there.
Do chat it all through with CCCS though.
df

Happytogetdebtfree

Hi I'm sorry your having a hard time of it I don't really know about been behind on payments... I'm sure if you post an Statement of affairs up we can offer some guidance it seems extreme to give up your home if there is another way that it can be solved....what have the mortgage said can they offer some help? Advice Hopefully it will be all ok you have come to the right place :-)