Help Concerning War Pension for BR

rfdebt

Hi all,

I have just recently signed up here, although I have been reading many posts for some time now. Unfortunately I think I will have to file for BR early in the New Year.

Quick Summary: Have run my own limited Company for several years now, but income has dried up, the company has no debts or assets, and so I will just close this down.

I have a mortgage of £1000 per month with nil equity plus unsecured debts of £96,000 and now that my income has dried up, I have no way to pay.

I and OH will commence seeking employment immediately to try and bring in some income.

A FEW QUESTIONS?

I receive 2 Pensions (1) War Pension from Veterans Agency of £105 per week –
(2) Army pension which was commuted and Pays £225 per month.

Q- Will I lose these pensions when I go BR?

Secondly, obviously once I file for BR, I will lose my home and going by some of the threads on this site – I feel it would be wise, if I found rented accn before I go BR and just hand the keys to my property to the Bank when I go BR.

This will help my already shattered nerves.

Can anyone please advise – Like I said, I have read many posts here, and you all seem very helpful.

Kind Regards
RFDebt

MammaCas

Hi RFDebt

I am by no means 'qualified' to answer your questions but I'm sure one of the very knowledgeable and helpful regulars will be along soon.

One of the main things they will advise though, is to contact one of the free debt advice charities like CCCS, National Debtline or Payplan.

Some of the posters on here have their numbers on their signatures.

Good Luck, you have definitely come to the right place :beer:

fermi

rfdebt wrote: »

I receive 2 Pensions (1) War Pension from Veterans Agency of £105 per week –
(2) Army pension which was commuted and Pays £225 per month.

Q- Will I lose these pensions when I go BR?

While I am 99.9% certain that you will be able to keep these, it would be best if you either contacted one or more of the people in my signature to confirm, or go straight to the horses mouth by talking the the IS enquiry line below.

http://www.insolvency.gov.uk/contactus/enquiryline.htm

rfdebt

Many thanks to MammaCas and Fermi for your replies, sorry for the delay in replying, been trying to get my head around all this. I am sure I will find out soon, once the big bad wolf comes a knocking at my door!

fiveyearplan

If you have nil equity there is no reason you will lose your home unless you cannot afford the mortgage. If you can still afford mortgage and you want to keep the house it would be cheaper than moving and probably a lot less stressful. Have you looked to see how much renting would cost you? Sometimes it isn't any cheaper than the mortgage. Is it you or you and OH going BR.

tigerfeet2006

Hi rldebt and welcome to the board,

You really do need to talk to one of the debt charities. They will be able to go through all the pro's and con's of everything with you and advise what is the best course you should take.

If you do decide to take the step to BR then when you go to court the judge will ask if you have taken proper advice you can tell him yes. If you don't then he can refuse the BR.

When you have spoken to the charities we can then help with advice and give you support through out the process.

rfdebt

Hi,
Thanks for your replies:

Fiveyearplan – Both myself and wife are going BR. Renting a decent property in this area can be achieved for around £550 a month but would in all honesty prefer to keep the house. It would be a hell of a lot less stress than having to rent, added problems with credit checks etc! Have managed to put some cash aside that would enable us to pay the mortgage for a couple of months and to live on – food, fuel bills etc. The problem is concerning the “beneficial Interest” on the property, haven’t worked out exact figures on the house yet, there maybe around £2,000 equity. If this is the case, does that mean the beneficial interest will be £2,000? If it is, we may have to go down the voluntary repo route.

Tigerfeet2006 – Yes I plan to ring one of the debt charities on Monday morning, using the weekend to get all my paperwork together - so I know more or less the figures involved in the debt. The decision to go BR has been made, too much debt to do an IVA. I went on one of those IVA sites and filled in a rough guesstimate on incoming money (worked on the minimum wage for both of us full time) and outgoings including the mortgage. It came back recommending BR!

Next week I will start defaulting on the unsecured debts, so have to get a move on.

I’m nearly 52 and getting a job that pays well might be difficult, I was an Admin manager for a large company for 8 years prior to starting my own company - should have stayed there! Still, there may be a chance and I will try to secure a better paid job if it doesn’t require a credit check.

Thanks for your help, no doubt I’ll be back asking more questions!

tigerfeet2006

The Beneficial Interest is the diffrence between what you have left to pay on your mortgage and how much your house is worth.

You will need to get 2 valueations to see but with the housing market as it is at the moment it might not be worth as much as you think.

The BI is divided between the both of you. So at £2k it would be £1k each.I think you have up to a year to find the money. There will be someone who is more knowledgeable about houses than me soon I'm sure.

rfdebt

Hi tigerfeet2006, thanks for your quick reply

Yes, we’ll have to get a couple of valuations done on the house and see, agree about the state of the housing market. In hindsight, I think we paid way over the odds for this place, granted it had been refurbished, new kitchen, new bathroom, windows, doors etc. We only bought it in Jan this year, across the road from us have had their house on the market for nearly as long as we have been here and it’s on for £10,000 less than we paid for ours. They’ve still not sold – hence why I think this house isn’t worth what we paid for it.

I read on the insolvency site that the person or persons going BR can apply for the beneficial interest but that it can be more difficult, time will tell I suppose, once we’ve spoken with one of the debt charities. We were going to ask my brother to apply and pay him out of our “stashed cash” if it turns out to be under £1,000 as it would only cost around a few hundred pounds. But, if we are talking thousands it might not be worth while trying to save the house.

This leads me to a dilemma; the next mortgage payment is due around the 1st Jan, which I plan to pay by cash into my bank. Had to draw out money from my account or unsecured commitments due out next week would have swallowed the money in there. I’ve just left the princely sum of £3.45 in the account. I feel awful doing that, but its all about survival now and keeping a roof over our heads, eating and keeping warm is all I care about. I’ll have to try to get 2 valuations done asap so I know before the payments due. It would be pointless wasting the money if we end up down the repo route anyway as we would need the cash for renting. What a mess, once it’s all sorted debt will become an alien word to me, never again will I allow myself to get in such a mess!

fermi

The calculation of the BI is down to each individual OR. Some will stick strictly to the formula:

BI = (House value - Outstanding Mortgage - Secured Debts) / 2

while other OR's will be more generous and allow all (or some) of the fees that would be incurred in realising the BI to be taken into account.

That makes it very difficult to say for certain on a forum like this what will happen.

rfdebt

Hi and thanks for your message fermi,
I guess we will have to wait and see, just don't want to spend money on something we may have to give up anyway!