Missing Payment - Consequences?

salamjanab

Hi,

May I seek some advise for a friend of mine since I have limited knowledge to help him.

He has a mortgage and personal loan account.

He lost job in sept11, then went overseas and found work – which is not paying much but he managed to use his savings and kept on paying both mortgage and personal loan until now (jul12).

Due to family reasons neither he can stay in the property nor her can let out the property he is paying mortgage for - so, what he is paying for mortgage is wasted money.

However as I know him, he like most of us, takes credit history very seriously, so he never missed or delayed any payments.

His salary is not enough and also earning in non GBP currency to pay GBP loans/mortgage is fairly difficult anyways.

Not in the near future, however later he intends to return back to UK and settle.

Now the issue is that his savings have disappeared (mostly in paying for the mortgage and loan) – and his current salary only allows him breathing space but now he has reached to a point that it is impossible for him to be able to pay mortgage and loan.

Can someone please suggest any best solution?

If unfortunately there is no solution at all but to miss payments, which I believe will end up with CCJs. What are the other consequences one should bear in mind, and its adverse impact?

He travels to UK to see his kids. He is British Citizen. Will Home office or airport staff cause any issues stopping him to enter, due to defaults on his name?

How long will it take to get his name cleared? and once his name is clear, will there still be any future adverse consequences.

Thank you for your advise and will be highly appreciated

DCFC79

Isn't this thread the same as this one here ?

Looks same to me but why start the same thread just shy of 3 hours later ?

BugsyBrowne

DCFC79 wrote: »

Isn't this thread the same as this one here ?

Looks same to me but why start the same thread just shy of 3 hours later ?

The OP is a nutter.

antrobus

BugsyBrowne wrote: »

The OP is a nutter.

Quite possibly.

This is apparently the situation:-

salamjanab wrote: »

....In short, his ex lives in his house with their kids. She wont leave or let the proprty sold. He has already spoken to the lender at length. This is another discussion, for now he is after advise and consequences if he stops mortgage and personal loan.....

If the OP's friend has now "reached to a point that it is impossible for him to be able to pay mortgage and loan" then there isn't a great deal that can be done. If he doesn't have the money, he doesn't have the money. The lender will go to repo, and the ex will just have to deal with it.

salamjanab

Thank you for your comments and apologies for posting twice.I couldsnt see my first posting on this forum (under Loan section) nor therewas any option to see what I have posted went live on the forum or not – so I repostedthe same thinking that my first post didnt went through.

Is there an option in this forum to see My postings?

Re my question. Is there anyone who can mention theconsequences he should bear in mind, and for how long will this adverse history affect him? I heard either 6 or 7 years. Will this damaged be completely gone afterthis period?
Since he is living overseas, how this can affecthim?

Tixy

To see your postings click on your name on the right hand side of any post you have made - then choose 'find more posts by salamjanab' from the drop down menu.

salamjanab wrote: »

Re my question. Is there anyone who can mention theconsequences he should bear in mind, and for how long will this adverse history affect him? I heard either 6 or 7 years. Will this damaged be completely gone afterthis period?
Since he is living overseas, how this can affecthim?

The adverse history could affect him for much longer than 6years - it could possibly affect him for the rest of his life in the UK - if one of the creditors decided to apply to make him bankrupt. Very difficult to guess without knowing the full picture of his finances, and even then there is no way of knowing exactly what his creditors will do.

salamjanab

Tixy,
Thank you for both advise.
Is there any criterian Creditors follow to decide whether to Bmake bankrupt or not, and is there any possibility to avoid such as showing that for so long he was paying personal loan and mortgage, without having enough source of income. He is not working in the UK.
I just found that he has already missed his Mortgage payment - but still paying personal Loan. I believe that he will not be ale to continue.

DCFC79

I reckon he should contact the creditors and tell them he cant meet the payments.

Tixy

No there is no way to know exactly what course of action his creditors will take. In theory any creditor he owes £750 or more to and falls behind on repayments could apply to make him bankrupt. But that doesn't mean they will - they'll consider whether this option gives them the best chance of getting back the most amount of money owed.

He really needs to be talking to one of the debt advice charities for some help. Some offer advice by email, which might be easier if he is abroad.
Information they'll likely want to know will include does the property have any equity in it? is it in negative equity? has the property been marketed for sale? Does he have any other assets in the UK?
Whose name is it in - sole or joint, etc.

salamjanab

Propertyis on sole name, and so is personal loan.
Do youhave any contact details (email address) for debt advice charities, I can passon.
Withmortgage lender. He has already discussed in details and attended manymeetings, without any luck. He even volunteered to get the house repossessedwithout affecting his credit history – as he was/is willing to bear fullfinancial loss as long as his credit rating stays on top, but bank told himthat they cant do anything until he is in default. Now he missed payments andgetting calls from the bank.
He hasnot contacted the lender for personal loan. Outstanding balance is around 10k,so there is a risk of bankruptcy as you stated above. Can you suggest what hemay discuss with the lender for personal loan to minimise the damage.
If he getsbankruptcy on his name. Will he not be able to remove this after 6 years?
I appreciateyour help and useful tips.

Tixy

The mortgage repayments are far more important that the loan repayment. Whilst he seeks advice I would suggest in the meantime stopping payments to the loan, paying as much as he can afford to the mortgage and putting the house on the market. If its on the market then at least when he speaks to the bank about the missed payments its clear he is trying to do something.

Debt advice charities listed on this link IMPORTANT - Where to seek professional impartial advice about your debts.

He even volunteered to get the house repossessedwithout affecting his credit history – as he was/is willing to bear fullfinancial loss as long as his credit rating stays on top,

Houses are only repossessed when its the only way the lender thinks they can get paid - there is no possible legal way they could do this until he is in arrears and his credit file affected. The bank don't want a house - they want the money repaid, if he is prepared to suffer the 'full financial loss' (I assume you mean its in negative equity) then the answer is to sell the house and repay any negative equity. If he is not in a position to do that then he is not in a position to suffer the full financial loss.
From what you have posted there is no way he can avoid damage to his credit file - in fact its already started by him missing a payment.

If a creditor was successful in having him declared bankrupt, whilst it would not show on his credit report after 6years from when declared - he would still have to declare it if asked for the rest of his life (e.g job applications, future mortgage /credit applications etc.)