A little help regarding my home.

Jt1979

Hi,
Im in a financial pickle to say the least. And i have been for a year or so now. I think its time to deal with it. I have arond 50k of debt, loans etc and i cant afford the payments for an IVA, so Bankruptcy is my only option, but i really really want to keep my home.
I have a mortgage for £207,000 and i would think it would be worth around £210,000 to £215,000. So my question is, if i went bankrupt next month for arguments sake what would happen to my house and how could i keep it?

Thanks in advance.

dancingfairy

It might be worth doing an SOA (see the makesenseofcards website and posting it here for advice).
Also do make sure you get advice from National Debtline, Step Change or your local CAB (if you do go bankrupt you'll need to be able to say you have sought advice from a debt charity).
In terms of the house then the OR has up unto 2 years 3 months ( i think it is) to deal with the issue of any equity in the house. As there is likely to be equity in the house I presume they can take it and sell it (whether they'd do it sooner or wait until later in the bankruptcy to see whether they'd getmore for it I don't know).
Can you afford to pay the mortgage without other debts? Is it comparable to rental figures in your area?
Lots to think about.
df

Jt1979

Thanks for the reply. Renting would probably work out more expensive than the mortgage to be honest. If we could loose the debt we could just about get by.
I have read lots about it,but its hard to take it all in and get down to the actuall facts.
Just for arguments sake if the house was valued at £212,000 now and i owe 207,000 theres £5000 equity,are they likely to do it now or make me wait the 2 years 3 months or is that a million dollar question or is there an actuall figure that they work to if that makes sense.
Also if they did it now and there was 5k equity, does that mean i would need to try and find or borrow 5k to keep the house?
Thanks

Mouse1812

You may find it helpful to read the Insolvency Service publication titled 'What will happen to my home'

It is marginal whether you have any equity in the property, do not forget selling costs which can be about 3%.

As the amount will be low, the OR will accept an offer from someone to buy back the beneficial interest.

Is your house jointly owned with anyone else?

Good chance you will be able to keep it, just make sure you read all the rules and understand what you have to do.

Mouse1812

jt1979 wrote: »

if the house was valued at £212,000 now and i owe 207,000

I would calculate that as negative equity. £212,000 less 3% selling costs leaves £205,640.

Jt1979

Thanks for the reply
The house is jointly owned with my wife.
So if its worth 212k it would be in negative equity, so would they make me wait 2 years 3 months before they decide. On the other hand if it was worth 215k i make it there would be around £1,500 equity. So would i have to find 1.5k now to keep it or would i still need to wait the 2 years 3 months. Is there an amonut that would make them do it now.
Sorry for all the questions

Mouse1812

Good news, half belongs to your wife!

Divide by two

Your wife will be able to offer to buy back your beneficial interest, the minimum OR will accept is £1,000 + legal fees (about £250). My wife did exactly that.

More good news, your wife can make an offer any time, she does not have to wait.

OR Technical instructions are here

The bit you want is part 6 here

edit to add: note they do not offer you the opportunity to purchase, your wife must be proactive and offer to buy. She will not, I repeat will not, need to appoint her own solicitor to act - assuming she knows how to sign her name and use a postage stamp.

Jt1979

Thanks so much but i have missed a vital point i think. The rest of the debt is in joint names, so i think we will both have to go bankrupt. Would a family member be able to do the same.
Sorry for the mix up.

Mouse1812

jt1979 wrote: »

i have missed a vital point i think. The rest of the debt is in joint names, so i think we will both have to go bankrupt.

Whooops, :embarasse

jt1979 wrote: »

Would a family member be able to do the same.

Yes they would, but you have just doubled the cost, that will be £1,000 + costs each.

Is your mortgage repayment or interest only?

Jt1979

Interest only. Are early redeption penalties taken into account?

Mouse1812

jt1979 wrote: »

Interest only. Are early redeption penalties taken into account?

Yes they are. OR is only interested in walking away with some £,£££ after all costs.

Interest only, so no reduction in amount owed (capital). Current housing market, flat. Could be nothing changes for a few years. You need to understand this, and keep a close eye it.