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PLEASE help, really need advice

Needing_A_Fresh_Start
Posts: 4 Newbie
For as long as I remember I have always struggled with money, or the lack of it. I took out loans/credit cards and finance deals which quickly spiralled out of control and ended up with my family and I entering an IVA. Currently 3yrs into the IVA a change of career, some desperate bad luck and huge house/car repair bills have really dropped me in it again!
I bought my house 11yrs ago and entered a 30yr mortgage. I have remortgaged twice and currently owe £100k. The house is valued at £100k. However, I purchased through a 'charitable trust' who provided a deposit for 25% equity.
The house has fallen into huge disrepair and needs approx £15-£20k of work doing to make it safe, warm and sanitary. I simply dont have it, and I cant get it. The mortgage company wont lend more as its negative equity, they wont even re-negotiate our mortgage as Im in the IVA. I cannot either get a loan or help to get it sorted. My wife and 3 children have to wash in freezing cold water, with damp on the walls, windows falling out and electrics sparking!!
Ive handed my car back to the finance company as I have paid over half and am able to. This was to lower my expenditure. However, now Im finding the cost of transport to/from work a huge strain....£140pm.
I feel my priority is to
a - move out of the house, give it up and let it be repossed. We simply cant continue living there.
b - move into rental accommodation which is around £150pm cheaper than my mortgage in an area very close to my work so I can walk in (saving another £140 of travel expense) not to mention a safe/warm home for me and my young family.
c - file for bankruptcy and have my debts wiped clean, start afresh. I know this will hugely affect my credit rating but at this time I cant get any credit anyway so whats the difference?
My questions are........
1 - should I do this, and if not why not?
2 - what should I do?
3 - what will happen?
4 - do I file for bankruptcy...do I tell my IVA people and do they do it? Can I include my IVA debt in the bankruptcy?
5 - can my future landlord evict me if he found out that Im bankrupt even though my rents paid on time?
6 - how long does the process take?
7 - Im writing to my mortgage lender to 'give up' my house what are they likely to do/say?
8 - the trust who lent the deposit, in 11yrs theyve never spoken to me and said they never would until the house is sold, should I tell them? Am I liable to repay them before the bank or at all?
9 - Are there any millionaires out there who would fix my house for free? (you never know, i'll try anything - desperate!)
Im knew to forums Im hoping that you guys can offer me some advice. Ive told the motgage company Im in the doodaah and they really didnt help, care or offer any solution.....apparently because I have £13pm left after my outgoings I dont qualify for help???!!!!! Anyway, look forward to the replies, thanks for your support.
I bought my house 11yrs ago and entered a 30yr mortgage. I have remortgaged twice and currently owe £100k. The house is valued at £100k. However, I purchased through a 'charitable trust' who provided a deposit for 25% equity.
The house has fallen into huge disrepair and needs approx £15-£20k of work doing to make it safe, warm and sanitary. I simply dont have it, and I cant get it. The mortgage company wont lend more as its negative equity, they wont even re-negotiate our mortgage as Im in the IVA. I cannot either get a loan or help to get it sorted. My wife and 3 children have to wash in freezing cold water, with damp on the walls, windows falling out and electrics sparking!!
Ive handed my car back to the finance company as I have paid over half and am able to. This was to lower my expenditure. However, now Im finding the cost of transport to/from work a huge strain....£140pm.
I feel my priority is to
a - move out of the house, give it up and let it be repossed. We simply cant continue living there.
b - move into rental accommodation which is around £150pm cheaper than my mortgage in an area very close to my work so I can walk in (saving another £140 of travel expense) not to mention a safe/warm home for me and my young family.
c - file for bankruptcy and have my debts wiped clean, start afresh. I know this will hugely affect my credit rating but at this time I cant get any credit anyway so whats the difference?
My questions are........
1 - should I do this, and if not why not?
2 - what should I do?
3 - what will happen?
4 - do I file for bankruptcy...do I tell my IVA people and do they do it? Can I include my IVA debt in the bankruptcy?
5 - can my future landlord evict me if he found out that Im bankrupt even though my rents paid on time?
6 - how long does the process take?
7 - Im writing to my mortgage lender to 'give up' my house what are they likely to do/say?
8 - the trust who lent the deposit, in 11yrs theyve never spoken to me and said they never would until the house is sold, should I tell them? Am I liable to repay them before the bank or at all?
9 - Are there any millionaires out there who would fix my house for free? (you never know, i'll try anything - desperate!)
Im knew to forums Im hoping that you guys can offer me some advice. Ive told the motgage company Im in the doodaah and they really didnt help, care or offer any solution.....apparently because I have £13pm left after my outgoings I dont qualify for help???!!!!! Anyway, look forward to the replies, thanks for your support.
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Comments
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Didn't want to read and run, but not sure I can offer any advice. I wonder if you may want to complete a SOA, see if any forumites have suggestions on that to help you? Good luck, and well done of having a light bulb moment about the current situation being unsustainable. xxLife isn't about waiting for the storm to pass...it's learning to dance in the rain.0
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Your plan is sound, but for one small problem - bankruptcy will cause havoc when you try to get a rental agreement. The very best you could hope for is that they will accept a guarantor, otherwise, you will have massive problems renting with such a bad credit history. If you can muster a guarantor, then your plan has definite merit though.Debt Free! Long road, but we did it
Meet my best friend : YNAB (you need a budget)
My other best friend is a filofax.
Do or do not, there is no try....Yoda.
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hoping to have a rental in place before bankruptcy. Thanks for the reply/advice though0
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You have already declared insolvency with the IVA so that is going to show on a credit check.
Are you still paying this? I assume not, and you have started to get the rental deposit, month's rent in advance and £700 bankruptcy fee together.
Your first step should be to discuss it with your IP, then probably an independent adviser like National Debtline.
I understand some courts will insist on the IVA being terminated before considering your petition for bankruptcy. You could check this with your local court.
If you already have 13 per month surplus and your rent is going to be 150 per month less than the mortgage, and the new location will save 140 travel costs, then in bankruptcy you will be looking at an income payment arrangement of around 300 per month for 3 years.
Whether this is better than just continuing with your IVA until completion is impossible for us to say without the detail of the numbers.0 -
Regarding an ipa and bankruptcy I wouls speak to step change, cab or national debtline. Also post on the bankruptcy forum here for great advice. The alloances for bankruptcy soa are likely to be slightly higher than you have in the iva. Also if you decide to go down this route stop paying the iva to save for renting and bankruptcy fees.:j0
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Thanks for the advice so far, really useful and very reassuring. Its a very lonely place and Im very grateful to all the replies.0
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Hello there, I'll answer your questions for you.1 - should I do this, and if not why not?
2 - what should I do?
3 - what will happen?
It's impossible to answer these questions based upon the limited amount of information you have given. The best thing to do is to consider how long it will take for your circumstances to improve staying as you are, and then based upon moving into rented accommodation and giving up the house and going bankrupt. For a lot of the folks we speak to, going bankrupt ends up being one of the best things they have ever done. It is not something to take lightly, I would urge you to do as much research as you can.
Here's our bankruptcy fact sheet: https://www.nationaldebtline.org/EW/factsheets/Pages/01%20EW%20Bankruptcy/Default.aspx
Here's a good guide about what happens to the home in bankruptcy: http://bis.gov.uk/assets/insolvency/docs/publication-word/what-will-happen-to-my-home.doc4 - do I file for bankruptcy...do I tell my IVA people and do they do it? Can I include my IVA debt in the bankruptcy?
Although some IVAs may have a clause that states that your IP can make you bankrupt if the IVA fails, it isn't something that we come across a great deal. It's likely that you will need to petition yourself. If you decide to do this, you should stop paying the IVA so that you can save up the bankruptcy fee. Any fees to the IP can be included within the bankruptcy.5 - can my future landlord evict me if he found out that Im bankrupt even though my rents paid on time?
That is potentially possible if there is a clause allowing it within the tenancy. I have never come across it happening mind you. At the end of the day, most landlords are just happy to get their rent.6 - how long does the process take?
It depends on the court's workload. It is usually a few weeks before you get a hearing date. Some courts are quicker.7 - Im writing to my mortgage lender to 'give up' my house what are they likely to do/say?
It is difficult to say. They may accept back the keys, they may insist that you adhere to the formal repossession procedure.8 - the trust who lent the deposit, in 11yrs theyve never spoken to me and said they never would until the house is sold, should I tell them? Am I liable to repay them before the bank or at all?
Any money owing to the trust would go into your bankruptcy.9 - Are there any millionaires out there who would fix my house for free? (you never know, i'll try anything - desperate!)
I'm sorry, I cannot help you there.
For what it's worth. It *may* be possible to go bankrupt and keep the property if you have negative equity. That guide I posted up explains more. You need to decide if it is actually worth keeping the house or not. I appreciate a lot of work needs to be undertaken on it.
Best wishes,
David @ NDL.We work as money advisers for National Debtline and have specific permission from MSE to post to try to help those in debt. Read more information on National Debtline in MSE's Debt Problems: What to do and where to get help guide. If you find you're struggling with debt and need further help try our online advice tool My Money Steps0 -
Thanks very much, thats brilliant advice.0
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