Voluntary Repossession

missymolly

Hi

I'm currently BR and live in a rented property. My own home was rented out, but is now empty, due to the finer details of being BR.

I have spoken to NRAM and asked them about voluntary repo, which they have been quite helpful with. They've sent out the form for me to sign to start the procedure, however, I've noticed that there is a paragraph which states that if there is any shortfall after the sale, then I am responsible for it. As the house is in negative equitity, I know there will be a shortfall.

I do not want to add to my problems, but neither can I keep the house as I've not been able to pay the mortgage for two months.

So, is there any way around this paragraph ? Do I have to change my stance and have the repossessed through the court route? Or does the debt get added to my BR?

Thanks

[Deleted User]

DO NOT SIGN IT - or anything else they tell you you must

I believe others have written their own note to include with the keys for voluntary repo, or just wait until they 'take' it back (which I'm waiting for them to do!)

As I understand it - If you sign anything that accepts liability for the shortfall then it creates a new debt that you will owe, to get it included in br never ever ever sign anything to do with mortgage/repo that might make you liable.

lbm

dancingfairy

Don't sign it would be my advice. You could well find yourself liable for any shortfall if you do that. If you write a letter you might want to just initial it or sign it but cross it through or something like that to make sure that your signature is not lifted somehow - hopefully one of the experts will advise further though.
df

missymolly

Hi

**Update**

As NRAM are now calling me on a very regular basis, I thought I'd call them tonight. So, I advised them that I want them to repossess my property and that I will not be signing the voluntary repossession form. So basically, bring on the court proceedings.

I was then advised of the following,that if, 'at the point of sale' whether I take the voluntary or the non-voluntary route' I am still BR, then any shortfall with come under that BR.

However, if the 'point of sale' happens after I am discharged, then regardless of the route taken, I will become liable for the shortfall, whether I have have signed any paperwork or not. Apparently it's all written down in my mortgage contract.

Now, given the way the current property market is going, my house could be up for at least 6 months (one up the road, reasonably priced & a good standard has been on the market for 8 months) which means it will more than likely be sold once I'm discharged.

So, now my stomach is churning and I really do not know what to do. It seems I'm out of one nightmare and straight in to another.

Thanks in advance.

FOXY1

Hi, I am in a similar position and my OR has said as long as I have added mortgage company to the forms it will get wrote off as part of the bankruptancy even if the sale happens after, as the debt was taken on before the bankruptancy. However the management company have told me they will rent the house until the arrears have been paid off, my OR has not got back to me on how I now stand.

tigerfeet2006

MissMolly, they lie, they are good at that. Your shortfall will be included in your BR. write to your OR and let them know your are going for repo and you want to make sure the house is included.

Foxy, this is a new one on us so I am sure that the folks on here would be very grateful if you would keep us appraised of what happens.

freddy911

A debt which is secured by a mortgage or a charge on a property is still a provable bankruptcy debt. The mortgage loan company is "a secured creditor" which means they have rights over an asset, the
house, and can require the asset to be sold to pay their debt. These rights are not affected by the bankruptcy.
On the making of a bankruptcy order the mortgage loan company could
make a claim in the proceedings but, unless it wished to give up the security, could only claim for any (estimated) shortfall.

If you continue to live in the property it is likely that you will continue to make payments to the mortgage loan company to avoid the property being re-possessed. When the property is eventually sold any
shortfall to the mortgage loan company is still a provable debt in the bankruptcy, even if you have been discharged, as you are released from the debt on discharge.

Your bankruptcy does not affect the obligations of any joint owner who has not been made bankrupt to repay the mortgage loan debt or any shortfall, as they are still liable for the whole of the debt.

After the date of the bankruptcy order the mortgage loan creditor may ask you to sign a "deed of acknowledgment" of the outstanding debt. If you have signed such a deed the mortgage loan creditor can take action against
you to recover any shortfall following the sale of the property.

Taken from the insolvency service web site.

Cagney31

Hi I am looking for some advice this is the first time I have posted;

In 2007 i took a picture secured loan for 67k and have been paying 534 per month now 634 due to arrears.

I have a mortgage with NRAM for 132 k and pay £1022 wach month. I also have 25k in unsecured debts and have a dmp for 148 with Step Change.

My house is now in negative equity and there will be a shortfall if we sell. My husband and I work non stop but are always struggling.

We saw an insolvency proffessional last week and he has advised us to move out into rented property and go bankrupt. He says the secured stuff will become unsecured and it will fall into sequestration.

My husband and I are totally confused we have four children, any advice on what we should do. Both Picture and NRAM unhelpful Also to date I have paid £50k to picture and they want 64k to close the loan.

Any advice would be appreciated.