Re-possession and IVA

leem2209

Hello all, I wonder if you can give me some advice.

Just over 2 years ago I split from my partner and was left with a mortgage which I solely continued to pay alone.

The mortgage lender would not allow me to take on the mortgage in my name alone so my ex is still on the mortgage and deeds.

Since then I have found it a struggle. I decided to rent it out to a family member and live somewhere cheaper to try and save money. I ended up having to buy new furnishings and started raking up debts on credit cards as well as loans I have already had.

This year, just after moving back into the property, the mortgage lender "somehow" found out about me renting out my house and have increased the monthly payments by 2%.

I sent off all documentation requested to prove I am living in the property yet they will not refuse to put the payments back to normal rates.

Also this year, I have had terrible luck with cars. After one car practically disintegrating, I managed to get another car only for the engine to seize, meaning I needed yet another car!

This had led to missed bills being paid, and also missed mortgage payments, plus the extra 2% each month they are demanding which I have refused to pay (for 6 months now)

Add to that their administration charges, I am now quite behind on mortgage payments (to their total of approximately £4K).

I have already entered into an IVA to try and clear my credit card and loan debts which have mounted up. Part of the IVA requests that I must sign a form to say I will not sell the property (so any future equity is secured for my creditors) I haven't yet signed the forms to prevent sale (these are lodged with the land registry and require the signatures of myself and my ex partner)

I have now had reminders that if I do not keep up with mortgage payments, then re-possession proceedings will be started.

I wish that I could get rid of the property. It has been a financial burden and emotional nightmare for the last 2 years. I have spent so much time working long hours to try to keep up with bills and feel I've barely lived. As 2014 comes, I will no longer live my life like this.

I ask for advice on what to do next. The property is starting to need some work doing. The gutters and fascias all need replacing. The 2 boilers (yes, 2. One for hot water, 1 for central heating) are both on they're last legs and could do with a few grands worth of work to get them replaced. The windows aren't the best and it could all do with fresh d!cor.

I've had the property valued at approx £135,000 in current condition. Up to £140,000 if I get some work done. I owe approximately £135,000 on the mortgage so Ideally a sale would be best. But to ensure that I cover the outstanding mortgage and estate agent fees, and solicitor fees, I would have to have some work done to make it more presentable, leaving me with yet more outgoings to pay out which I cannot really afford. And don't forget, I am not supposed to sell my house as one of the conditions of the IVA.

So where do I stand if it goes down the route of re-possession? How does that leave me regarding costs? What will it mean for my IVA agreement?

I know my credit score right now is rock bottom so future finance at the moment is the least of my concerns. I am scared about my current financial situation and having no life in order to repay debts.

I feel like just running away and starting fresh. But I know thats not possible.

Any advice is much appreciated.

chanz4

First charges always come first, and bet you ex reported you

ethank

You need professional advice.

Recommend that you speak to the Citizens Advice Bureau or Step Change - both are charities that will not charge for their advice.

leem2209

chanz4 wrote: »

First charges always come first, and bet you ex reported you

It wouldn't be in her interest to report me as her name is on the mortgage also, so she is liable for any charges etc too.

leem2209

ethank wrote: »

You need professional advice.

Recommend that you speak to the or both are charities that will not charge for their advice.

I organised my IVA through step change. Will they not want me to keep hold of the property for the next 5 years? There is no way I will be doing that.

Thrugelmir

leem2209 wrote: »

I sent off all documentation requested to prove I am living in the property yet they will not refuse to put the payments back to normal rates.

Not a game. Where when you get get found out you receive a ticking off and everything returns to normal. Transactions such as mortgages rely on a high degree of trust. Once the trust is broken there's no turning back. The lender is clearly indicating that they no longer want your business.

Annisele

leem2209 wrote: »

I organised my IVA through step change. Will they not want me to keep hold of the property for the next 5 years? There is no way I will be doing that.

Step Change are a charity, they give excellent advice, and they've seen it all before. Tell them the situation you're in and see what they say.

If keeping the property was a condition of your IVA, then selling it (and breaching the terms of the IVA) will likely have consequences - which may include your original creditors pursuing you for the full amount of their debts again.

On the other hand, if there's no equity in the property and keeping it is only going to cost everybody more money, it might be possible to negotiate selling it and remaining within the IVA.

Ultimately, if the IVA fails then bankruptcy might be the best option - but that's something Step Change can advise on.

leem2209

I think my best solution to all this is to stay with my home and get a lodger. I am still waiting for the mortgage provider to remove these excess charges they've been mistakenly charging me. Once they remove the charges, the arrears are only small and I can make arrangements to repay them with the income from the lodger.