Am I doing the right thing??

Tink2107

Hi everyone,

Hope you are all well - apologies in advance at the length of this thread but I just want to get you to where I am up to with the full story!

So here goes...

Basically, as soon as I was able to get credit I did and I used it to furnish my flat, pay for holidays, clothes etc - the usual stuff for a girl in her late teens early 20's. I got loan to pay of credit card got another credit card then took out another loan and so on. I was always able to pay the repayments and continued making payments.

2007 - I decided I wanted to get on the property ladder, have a good job earn a good wage with my commission and was already paying quite a bit out in rent so thought I’d be clever and invest it in my own property. Silly thing is my basic wage wasn’t a great amount so not many mortgage companies would look at me. In the end I got offered a mortgage with GE money (apparently I have recently found out one of the worse companies to go with) Because I was that determine to get on the ladder I didn’t care so there I go tying myself into a 100% mortgage on interest only (I told myself it would only be for the first 3 yrs so I can afford the payments then I’d remortgage onto a repayment mortgage) So I now have outgoings of about £1100 before I even look at food or living.

Then my commission structure at work changed and I wasn't earning as much however I still paid everything even the min payments which were only just covering the interest in some case - I didn’t have much money left at the end of the month but I ALWAYS paid my bills. In hindsight I probably should have sorted myself out then when I couldn’t afford to live.

Roll onto 2009 October, Plodding along not very happy but not feeling there is much I can do about it and I meet my now partner (well I knew him already) we got together and things happened very quickly, a few months into the relationship I find myself pregnant. I decide to go through with the pregnancy and now have a gorgeous 1yr old little girl who is everything to me!

So knowing I was going on maternity I decided to contact my creditors in the Jan (I was going on maternity in June), me thinking I was being pro active. Nope. None of them wanted to know they didn't care basically until I missed payments they were not willing to help me. By this point I was really depressed and not enjoying my pregnancy just constantly upset about my looming maternity and lack of income and not being able to afford my bills. I decided to go and CAB had my appt with them and got help through Shelter who advised me to pay my creditors token payments at the time but said my best option was BR. I didn’t even want to consider it. So up to this day I have been making the token payments. But kept thinking about the bankruptcy option. I kept thinking my parents will be so disappointed in me; I'd be a failure to everyone!

May 2010 Me and my partner decided it was more appropriate to live in his 2 bed house, his being slightly bigger especially as we had his 2 other children from a previous relationship 3 times a week. I contacted my mortgage company to see if I would be able to rent my house out but nope, to change to a buy to let they wanted 20%, I couldn't sell the property because it was negative equity with the recession and I couldn't remortgage because everyone wanted a 20% deposit for buy to let. So basically the mortgage company wanted me to pay £582 a month on an empty property plus pay towards the upkeep of my partner’s property all based on my £124 a week statutory maternity pay. I decided to rent it out anyway but what I got in rent didn't even cover the repayments and then my tenant moved out in May this year.

So this brings me to now, I have made the decision to go BR I have all the forms and keep reading them and can’t make head nor tail of them. I have not paid my mortgage last month nor this month and I am still only making token payments to my unsecured creditors and to be fair they have all accepted these and are not on my back at the moment. I went back to work in April but only part time so only really earning about the same as I was on maternity. I am doing a foundation degree starting in September and will hopefully be getting a student loan to pay for the fees.

I am so down and just look at everything as a negative I feel like I never smile and I must be a nightmare to be around. I am constantly arguing with my partner and he constantly tells me he loves me and try's to cheer me up but I just can’t see the positive in anything. I get upset or angry at the slightest thing and I don't want this I hate myself for getting into this situation.

So really I haven't got any specific questions - I just wanted someone to talk to and to hear some wise words and basically just get everything off my chest.

Look forward to your responses and I'm sorry if you have wasted 10 minutes reading this thread.

Thanks in advance

Donna x

freddy911

First of all chin up, nothings ever that bad and you have the new baby to think about if you have made the decision to go BR stop paying all your creditors it will help you pay for the BR fees.

Have you contacted the CCCS or the CAB they will help you fill out the forms, and if you search the stickys theres links to examples of the filled out forms to give you an idea of what you should be writing.

Good luck

tigerfeet2006

Hi and welcome. Well done on having the courage to face up to things.

As Srichar says if you look in the sticky marked LOOK HERE FIRST: Bankruptcy Help sticky you will find lots of useful info.

Also ask on here and people can help you with the forms.

DerekDerrek

Hey Tink!

just a quick shout out to say don't stress and try not to worry all the time, find some time to relax... put things in perspective, family, career, life and love (especially with your new baby).... and err banks and the whole debt-trap society we live in!!!

sounds like you are being proactive, go for it!!!

and take it easy, I too and preparing to maybe ditch my negative equity laiden house and to run the insolvency gamble, just remember you aren't alone, you are allowed to make mistakes in life, and this is what makes us bigger and stronger.

Looking forward to hearing your positive strides forward

NeverAgain_2

Tink,

You don't say how much you owe, but with negative equity, I will guess it's a few tens of thousands.

Realistically, you are never going to repay it.

Bankruptcy is almost certainly your best option, and the sooner you do it, the sooner you will be able to make a fresh start.

On the plus side, you have somewhere to live, and a supportive partner.

I think you need to get to grips with those forms.

rocketman80

Hey Tink,

As the others have already said, read the sticky marked 'Look here first' on the first page of the Bankruptcy thread.
Any questions (or need for a shoulder to cry on), ask in this forum. The only stupid question is the one you don't ask. Everyone in here is great and will help you.

And keep your chin up. The bravest thing is to admit you need to go bankrupt and to face up to it, which you've done.

The forms look terrifying, but they are not that bad if you sit down and have a read of them.

And well done on going back to school for a foundation degree! That's something to be proud of and make you smile.

Rocket.

Tink2107

Thank you so much for all your kind messages, I finally got round to sitting down and filling my forms out and, think when I have been paid I will have the fees together however I do have a few questions;

I rang my lender today to ask for the voluntary repossession forms and they asked why and then told me they would have to go through the t&c's with me and then they advised me to go speak to an financial advisor, I explained I had already seeked advice from CAB and also CCCS and that I wasn't willing to wait another 8 weeks for an appointment with CAB before I went bankrupt. But I need these forms and confirmation from the lender that the house is repossessed. Basically they are refusing to send me the forms and are telling me that if I did repossession and then went bankrupt then it wouldn't be included in the bankruptcy a few tears and harsh words and I put the phone down.

I just want it over - the main reason I am going bankrupt is because of the shortfall I will get in the mortgage if I were to sell.

Any pointers for the repossession will be very much appreciated.

Also my student loan - will they look at this as income even though I HAVE to pay this back bankruptcy or not? I need to buy a laptop so I can do my studies and books etc but if they look at is as income then I wont be able to afford to get these essential things I need to pass my course.

I also tried to ring the council tax to remove my name off the bill, which they refused as I am Gareth's partner so therefore still equally responsible in paying the council tax, someone advised me I have to remove my name otherwise it shows i have interest in his property _ I cant stress how much I do not want my partner to be affected by my bankruptcy (his house, car etc). I got in debt before I met him so therefore I don't want him to suffer.

Look forward to hearing from you and once again thank you for your responses so far.. you have all give me a positive look on things :-)

NeverAgain_2

Your mortgage lender is (successfully) trying to frighten you.

Any shortfall after the house is repossessed and sold effectively falls into your bankruptcy.

Put another way, the secured mortgage loan you owe becomes an unsecured one.

While the lender has been nasty by misleading you, you have just told them they are not getting their money, so they are not going to be delighted about that.

From this day forward, do not sign anything relating to the mortgage under any circumstances.

Given how the lender has behaved towards you, I would not contact them again.

If they call you, tell them only to contact your Official Receiver.

freddy911

They proably want you to go BR first so that they can bully you into signing a deed of acknowedgment post BR, this would be the only way they could get there money back from you. You can still go BR before the house is delt with, just dont sign any thing from them after you have done so.

From the IS website;

Question: If my house is sold sometime after the bankruptcy order is any shortfall on the mortgage still a debt in my bankruptcy?Answer: 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.

Tink2107

Hi Guys, Just a quick update and a few questions.

I have now got the fees in hand and all the forms filled out and I am planning on going to my local court on Monday, do I just turn up? What do I need to take with me?

I have sent my keys back to my mortgage lender and signed to say I want the house repossesed, shall I wait until they have confirmed in writing?

Also I have just started a foundation degree with which I am eligibe for student loan and grants, will the OR take this off me and want it for IPA payments?

Many Thanks in advance

D x

NeverAgain_2

What the mortgage lender does makes no difference.

They will almost certainly repossess, but that's up to them - there's no point waiting around for letters.

Nothing to stop you calling in to the court, some do a drop-in service.

But some want appointments, so to save you a possibly wasted journey, ring before going.

Not all county courts do bankruptcy, so when you ring ask them the address of the court you have to go to.

I think your student grants will be treated separately, the usual advice is to open a new account just for that money - others will confirm.