Options with house after declaring bankruptcy

banksshouldworry

I declared br in Jan of this year and I understand that the OR has a say in what happens to my property for 3 years from the date of my BR.

The house is around £10k in negative equity so is unlikely to be back in positive equity to make a sale worthwhile.

I could stay in the house, still pay the mortgage, not move and therefore the negative equity won't be an issue.

But what if I want to dump the house?

What options do I have to move on without incurring more debt from a clean slate?

Could I have to dump the house and not have the negative equity part added to my debts?

alastairq

If you wish, stop paying the mortgage, seek a nice place to rent, move out, & allow mortgagor to re-possess.

Since your mortgage account pre-dates your bankruptcy, any shortfall will be included within that bankruptcy.

But, you should not sign anything from the mortgagor, especially any Deed of Acknowledgement.

However, sadly, you have done things a bit back-to-front?

If you really weren't happy staying in your current home, then re-possession should have been your first aim.

Then you could have sought a nice place to rent...and ..since this would be pre-BR, the BR would obviously not be on your credit records for all to see.

Now, because you currently have the BR on your records, this might prove a difficulty when dealing with letting agents, Landlords, etc.

I suggest if, staying is not too much of an issue, why not stay put?

If you suspect property values may rise to the extent that your home may go into positive equity, why not make an offer to the oR to purchase the OR's interest?

This [from research on here] may amount to around £1000 plus costs.

The OR may be happy with this, rather than waiting 3 years 3 months...only to perhaps have to hand the interest back to you, gratis?

You would then have the security of the property being completely in your hands?

Regardless?

Whatever, the above may be a better choice than trying to rent, with the BR already on your records?

tigerfeet2006

Alistair, you keep quoting 3 years and 3 months in these sort of posts. It is at around the 2 years and 3 months mark that the OR will come back to look at whether there is any chance of equity in the property and after 3 years if the OR hasn't dealt with it then the BI then it reverts back to the owner.

alastairq

sorry, my bad....the 2 is too close to the 3 on my keypad.....however, the general idea I tried to put across focussed on the option of making an early offer to the OR...or, sitting & waiting?