Worried about increasing house prices :-(

watcher27

Hi,
We went BR in Jan 2012 and have now been discharged.

At the time of going bankrupt, our house was worth around £140K, with a mortgage balance outstanding of £172K.

So obviously the OR wasnt interested in the property at the time.

But now I'm getting concerned that the house prices are increasing at record levels (according to the news this morning), and there will soon might be equity in the property

Any one else have this problem?

debt_doctor

Yes, I saw the same news story - although I have to say it depends where you live!
There is absolutely no upward movement in property prices where I live.
As a guide, if your property rises to become up to £10k positive equity then the likely result is a charging order on the property rather than sale.

DD

Mouse1812

Mrs Mouse was likewise worried about house value increasing (and mortgage decreasing) so she wrote to OR and offered to buy my BI back. All done and dusted within two months, cost £1,000 plus legal fees approx £250.

arcon5

Even at record rises it's unlikely to go up by 35% in just 3 years. But could well be worth getting a valuation to determine how likely it is to happen

watcher27

Prices still rising at record levels! :eek:

Think I'm going to bite the bullet and call the OR

watcher27

debt_doctor wrote: »

Yes, I saw the same news story - although I have to say it depends where you live!
There is absolutely no upward movement in property prices where I live.
As a guide, if your property rises to become up to £10k positive equity then the likely result is a charging order on the property rather than sale.

DD

Sorry to resurrect this thread again, But are you saying that the property can be upto 10K in equity before they force a sale?

We had our's valued by 3 estate agents as requested by the OR, and it's been valued at £160-£165K. The current settlement figure on the mortgage is £167K, so we are at panic stations at the moment!!! :eek:

debt_doctor

watcher27 wrote: »

Sorry to resurrect this thread again, But are you saying that the property can be upto 10K in equity before they force a sale?

We had our's valued by 3 estate agents as requested by the OR, and it's been valued at £160-£165K. The current settlement figure on the mortgage is £167K, so we are at panic stations at the moment!!! :eek:

Hi, what I'm saying is that if a property has less than 10k equity it is deemed not enough to attract an IP to take on the estate, so in light of this the IS place a charge on the property instead which will be paid when the property is eventually sold by the owner. The charge attracts statutory interest at 8% per year.

So no forced sale in this situation.

DD

watcher27

debt_doctor wrote: »

Hi, what I'm saying is that if a property has less than 10k equity it is deemed not enough to attract an IP to take on the estate, so in light of this the IS place a charge on the property instead which will be paid when the property is eventually sold by the owner. The charge attracts statutory interest at 8% per year.

DD

I really wish I understood what you just said

The way I understood it (in a very basic form), is that because our property was in so much negative equity at the point of bankruptcy, they had no interest in it as they would gain nothing from selling it.
But, they then "watch it" for 3 years to see if the value increases and after 3 years if there is equity in the property, then they will sell it & give the money to the creditors. Correct?

But this process we are currently going through of buying their interest in the property, basically means that won't happen?

In a nutshell

debt_doctor

watcher27 wrote: »

I really wish I understood what you just said

The way I understood it (in a very basic form), is that because our property was in so much negative equity at the point of bankruptcy, they had no interest in it as they would gain nothing from selling it. Agreed
But, they then "watch it" for 3 years to see if the value increases and after 3 years if there is equity in the property, then they will sell it & give the money to the creditors. Correct? No. They will 'watch it' until the period 2 years 3 months. If at this point there is no equity then the property will be given back to you at no charge. If there was equity, then if less than 10k, the property would not be sold but a charge placed upon it instead.

But this process we are currently going through of buying their interest in the property, basically means that won't happen? Are you going through buying the interest in the property? If so, and you reach agreement with the OR, then that agreement will always stand, no matter what happens in the future.

In a nutshell

Hope that might clarify things.

DD

watcher27

debt_doctor wrote: »

Hope that might clarify things.

DD

It did, thank you

So, at 2 years 3 months, they don't force a sale but put a charge on the property, and this lasts permanently? We received a B178 notice from the land registry.

And yes, I have asked to buy back the interest and he said it's a standard £1K fee + court costs of £250.

He just needed 3 valuations and a mortgage settlement figure.

It's a shame really as we went bankrupt on 16/1/12 so not to far from the 2 years 3 months date, and £1250 is ALOT of money to us. However, I don't want to risk it

debt_doctor

Then if you pay the fee at this point, your property will be safe forever, and will be yours once again.

Good luck.

DD