going bankrupt whist owning own home

hazel3603

Hello everyone. Filled in both br formas as much as I could for them both. My friends hubby owes three thousand on the mortgage-but they are actually in debt of 15000, not the guessed 7000. She has been doing a little research and asked waht equity release means. I think they are hoping to release funds on the value of the house to clear all the debts. Any advice would be super. They have an app with the bank next week.. Would be a shame to lose the house over 3000 remaining on the mortgage...

PippaGirl_2

Why are they planning on going bankrupt AND looking into equity release schemes? Surely if equity release is possible then they won't need to go BR if everything is paid off?

Which debt charity have they taken legal advice from out of the three recommended?

hazel3603

well, panic bought them to the conclusion that they would have to go BR, and in doing so, lose the house. But now they are trying to figure out what other options may be available. They have been paying creditors for some time, but still having difficulties bringing mortgage payments up to date. They want to know if money can be released in some way through the house in order to settle the mortgage and clear all the debts in full, leaving them with a clear slate. They have already taken advice from cab, hence the smaller payments to creditors, but they are clearly struggling. They don't talk, her hubby is old school and thinks as he is bringing home the money, there's nothing to worry about. They clearly can't pay everyone, so BR was an option. I'm not sure though that it's the only option. They don't have 2 pennies to rub together, so the stress is getting her down and she already has depression and 2 children , both requiring medical/mental/emtional assistance. Poor family.

PippaGirl_2

I think they should get legal advice wrt to the way forward from either

Consumer Credit Counselling Service - Website: CCCS Telephone: 0800 138 1111
National Debtline - Website: National Debtline Telephone: 0808 808 4000

If they have equity in the house that could pay off debts then it is inevitable if they go BR that that would be used to pay off debts so rather than go BR and then get a four figure sum of OR fees added to their debt to be repayed from the house and potential IPA they would be better selling the house to pay off the debt. They could rent a property then. But as I say they should phone one of the two above for advice before proceeding with any action, including bankruptcy.

hazel3603

oh, well that's an idea. I know the house has a huge damp problem and they have no money to sort it, but the house, even in it's existing state, would make them enough money to move on. I will give her the details you posted and ask her to talk to someone first though.....THANK YOU!!!!!!!!

hazel3603

Hello everyone!!!! Right, my friends mortgage has been paid off by the father in law. They now owe 13000 to creditors. Can they go to another company to release some equity to rid themselves of the debts? Can they remortgage? Santander won't help them now...any advice please, she is pulling her hair out....many thanks

hazel3603

The problem is if they put the house up for sale, they still can't afford to pay the debts and no-one around here is having any luck selling!!

hazel3603

ADVICE??? Thanx!!!!!!!!!!!!!!