Mortgage Shortfall - likely creditor action

s1985

Hi, I have a mortgage repossession shortfall from 2012 which equates to around £40K. Ideally I would like to arrange a F & F settlement but to date that has not been successful. The communication with the creditor has been a nightmare. No payments have been made since 2011 as I have little disposable income to contribute to such a huge debt. I am reluctant to start token payments as it is essentially pointless as will take more than my lifetime to pay off! I'd also rather get it sorted as soon as possible to stop it hanging over me.

I imagine this may get to a stage where bankruptcy is the only option, however I work in financial services and my qualifications, etc are all valid on the basis there has not been bankruptcy or financial difficulties.

I am going to continue pursuing a F & F settlement but my question is how likely is it that the creditor or a DCA will look to make me bankrupt in time if I cannot come to an agreement with them? I don't have any assets to worry about but there is a good chance that I will lose my job if this happens.

Thanks

National_Debtline

Hi

If you don’t have other assets I think it’s unlikely a creditor would want to petition for your bankruptcy. It will cost them money to apply, they will most likely not get anything out of it, and you will not owe them any more money.

I would think the more sensible course of action from their perspective would be to get a CCJ, although if that meant you losing your job it could make it even harder to get their money back.

James
@natdebtline

sourcrates

If you have no assets, then there is no point making you bankrupt is there.

As James said, a CCJ is more likely, but again, aside from an attachment of earnings order, with no recoverable assets, there options are limited.

Keezing

s1985 wrote: »

Hi, I have a mortgage repossession shortfall from 2012 which equates to around £40K. Ideally I would like to arrange a F & F settlement but to date that has not been successful. The communication with the creditor has been a nightmare. No payments have been made since 2011 as I have little disposable income to contribute to such a huge debt. I am reluctant to start token payments as it is essentially pointless as will take more than my lifetime to pay off! I'd also rather get it sorted as soon as possible to stop it hanging over me.

I imagine this may get to a stage where bankruptcy is the only option, however I work in financial services and my qualifications, etc are all valid on the basis there has not been bankruptcy or financial difficulties.

I am going to continue pursuing a F & F settlement but my question is how likely is it that the creditor or a DCA will look to make me bankrupt in time if I cannot come to an agreement with them? I don't have any assets to worry about but there is a good chance that I will lose my job if this happens.

Thanks

Would you mind sharing the events that led to your repossession?

MrsTinks

Sourcrates - question... Does a mortgage debt in a case like this become statute barred after 6 years? I'm wondering as the debt would essentially have become un-secured?

fermi

MrsTinks wrote: »

Sourcrates - question... Does a mortgage debt in a case like this become statute barred after 6 years? I'm wondering as the debt would essentially have become un-secured?

https://www.nationaldebtline.org/EW/factsheets/Pages/mortgage-shortfalls/mortgage-debt.aspx

If you owe mortgage capital

Mortgage capital is the money you originally borrowed. For this part of a mortgage shortfall debt, the lender has 12 years to use court action to make you pay. This is under section 20 (1) of the Limitation Act.

If you owe interest

Mortgage interest is the interest you were charged to borrow the money. Your lender may also charge interest after your home is sold. For this part of a mortgage shortfall debt, the lender has six years to use court action to make you pay. This is under section 20 (5) of the Limitation Act.

s1985

Keezing wrote: »

Would you mind sharing the events that led to your repossession?

Basically break up with ex-partner. She moved out and stopped contributing towards the mortgage, I asked the mortgage company for a payment holiday/interest only but they wouldn't agree to anything without my ex signing the documents. I couldn't afford to continue paying everything on my own and so eventually stopped paying, moved back with parents and the house became repossessed. House was sold but there was negative equity of £40k or so. I don't know if they have pursued my ex - it doesn't appear so.

Have had limited correspondence from the mortgage company and has been passed around a few debt collectors - they write to me, I explain that I do not have a spare £40K, send the income/expenditure showing no spare cash and then it goes back to mortgage company. Has just been going around in circles but I'd like to get it sorted somehow so I can move on - bankruptcy isn't an option for me though as I've mentioned above.

s1985

sourcrates wrote: »

If you have no assets, then there is no point making you bankrupt is there.

As James said, a CCJ is more likely, but again, aside from an attachment of earnings order, with no recoverable assets, there options are limited.

True.

Am I right in thinking the attachment of earnings would only be apply if I didn't keep up with the terms of the CCJ?

National_Debtline

s1985 wrote: »

True.

Am I right in thinking the attachment of earnings would only be apply if I didn't keep up with the terms of the CCJ?

That's correct. It's a form of enforcement which could only be used if you default on the court order.

James
@natdebtline

sourcrates

MrsTinks wrote: »

Sourcrates - question... Does a mortgage debt in a case like this become statute barred after 6 years? I'm wondering as the debt would essentially have become un-secured?

What Fermi said !!!!!!!

[Deleted User]

I think you should state ask why you are being asked for the full balance: surely your ex is liable for 50% of the debt.