Very confused and don't know what to do for best

Luabel

I would be really grateful for some help and advice if possible.

I have been in an IVA in my own right for 3.5 years (so approx 18 months to go).

Everything was fine, until I lost my job in January 2011 and couldn't find anything else despite applying for approx 10 jobs every single day.

With only one wage coming in, we got further and further behind with mortgage, secured loan and pretty much everything else. In January this year (a year later) I finally found employment but am earning £8k less per year.

NRam took us to court and got a repossession order in July this year but we borrowed some money from relatives and paid off all but £4k of the arrears so they suspended it as long as we paid our usual mortgage payment of £1100 per month plus another £450. I went through an income and expenditure form with them and despite it showing we were in deficit each month by £107, they said we still had to pay them the extra £450.

As you can imagine, we just aren't managing. I've tried and tried to get a second job and spoken to my boss about a raise but nothing.

I have spoken to my IVA company and they have suggested we find somewhere to rent, hand back the keys to the mortgage company and then go bankrupt, but my husband is refusing saying we should split up with him going to live with his parents, me going to live with my two younger daughters at my mum's (who has only one spare room) and then sell the house and continue paying back the debts, getting back together once everything is clear.

The mortgage is £284k and the secured loan £38k. The house has been on the market for 3 months at £300k and we haven't had one offer (and only 5 people round to look). Hubby has a loan of £2.5k and a credit card with £10k on. We also now owe one set of relatives £8k and my mum £15k (from a loan some years ago). Obviously paying things back is going to take quite a few years.

As I have always been the one who dealt with the finances (obviously not very well) my husband says it is all my fault and veers from not talking to me to shouting at me.

The mortgage is in joint names as is the secured loan.

Am I right in thinking that if I go bankrupt and he doesn't, then he will be responsible for the mortgage and secured loan on his own?

Also, what if we can't find anybody who is prepared to rent to us because we are bankrupt?

I have completed something on line which says if I moved out with my two daughters I may be entitled to some benefits - but does that apply if I am bankrupt?

Please help - I am so very confused.

silvercar

The mortgage is £284k and the secured loan £38k.

So the total debt is £322k, to sell for any less yourselves would require the consent of the loan company.

Hubby has a loan of £2.5k and a credit card with £10k on. We also now owe one set of relatives £8k and my mum £15k (from a loan some years ago). Obviously paying things back is going to take quite a few years.

If you both went bankrupt all those loans are included in your bankruptcy, which means no money for the relatives or your mum.

Am I right in thinking that if I go bankrupt and he doesn't, then he will be responsible for the mortgage and secured loan on his own?

Yes.

Also, what if we can't find anybody who is prepared to rent to us because we are bankrupt?

Normal order is (1) rent (2) hand keys to house back (3) go bankrupt.

I have completed something on line which says if I moved out with my two daughters I may be entitled to some benefits - but does that apply if I am bankrupt?

If you are living apart but together then any benefits are assessed on joint income. If you are separated then you would be assessed on your own income alone, but he would be expected to pay maintenance to you for the children.

As I have always been the one who dealt with the finances (obviously not very well) my husband says it is all my fault and veers from not talking to me to shouting at me.

Debt is stressful. Though the obvious retort is that he should have been looking after the finances if he could do them better, you need to pull together on this.

Luabel

Silvercar - many thanks for the quick response.

Re renting - I don't want to mislead anyone so shouldn't I tell them when I am looking that I will be going bankrupt shortly?

silvercar

Luabel wrote: »

Silvercar - many thanks for the quick response.

Re renting - I don't want to mislead anyone so shouldn't I tell them when I am looking that I will be going bankrupt shortly?

If a rental agent or landlord is going to credit check you, it is best to be honest as debts could show up on your credit report. You could (honestly) say that you need to rent because your mortgage has become unaffordable, that you understand that paying rent is the top priority. Not sure if you need to mention the bankruptcy possibility but if you do emphasise that bankruptcy will remove your debts making it easier to afford the rent.

Luabel

To be honest I think my credit is cr*p and that's the other thing that's worrying me about trying to rent - is anyone going to rent me anywhere when my credit comes back as bad?

silvercar

Luabel wrote: »

To be honest I think my credit is cr*p and that's the other thing that's worrying me about trying to rent - is anyone going to rent me anywhere when my credit comes back as bad?

Always someone. Maybe more chance with private landlords direct rather than through a letting agency.

One option if you are definitely giving up your home AND there is no equity in it AND you are both going bankrupt is to stop paying the mortgage and save up a sizeable deposit/ rent in advance. This should help convince a landlord that you are a safe bet.

Luabel

Problem is as there is a suspended repossession order on the house as soon as we miss a payment they can repossess the house which means no chance to save up.