Very large debt help

Hariba

I’ve been on to the mortgage provider. We would have to reapply for a mortgage and go onto a new rate if they accept the application. They said this could take 6-12 weeks at the moment. I’m really unsure what the best thing is to do. 

emwi

You seem to be getting contradictory advice on here which is unusual. You need to find out if there is any advantage to transferring the house to your wife. Maybe CAB or Stepchange as a starting point then a solicitor. It would take a long time for it to get to the stage of repossessing your house if that's even a possibility.

Billy_B_North

sourcrates said:

Billy_B_North said:

sourcrates said:

Billy_B_North said:

Hariba said:

sourcrates said:

First thing you need to do is get your name off the house deeds, once you've done that, you have no assets, or income, and no way to pay the debt, the creditor cannot do anything about it, its dead in the water basically.

Sure they may take you to court, once you say you have no income, case will be dropped.

If you don`t take these actions, then a CCJ and charging order are likely, and you will find yourself in front of a judge trying to persuade them why they should not grant an order for sale to the creditor.

You can avoid all this by signing the house over to your partner.

Is it legal to do this? I asked the debt advise service about bankruptcy and was told not to sign anything over. To be fair, it should be her house as she has paid the mortgage. 

No, and you could find yourself on the wrong end of a criminal prosecution if you do it

If the house was signed over to another party, and the creditor chose to make the OP bankrupt, the worst that could happen would be a bankruptcy restriction order (BRO) may be imposed on the OP, this is not a criminal offence, nor would they be subject to criminal charges.

That’s not correct. The transfer of the house could be unwound, and a confiscation for fraud could follow.

https://www.alllaw.com/articles/nolo/bankruptcy/hiding-property-assets.html

That applies to the US only.

I still don’t believe that you are correct;

https://www.payplan.com/debt-solutions/bankruptcy/fraud-explained/

https://www.citizensadvice.org.uk/debt-and-money/debt-solutions/bankruptcy-2/bankruptcy-offences/

Hariba

Thanks for all the comments. I’m quite confused about what to do. I’ve been on to some of the various organisations including CAB and they are all giving me different advice. One has said that my partner can in no way be responsible for the debt or expected to pay it from her salary, another has said that my partner should expect to pay it monthly or risk the house. I didn’t even know that a company could force bankruptcy. I thought bankruptcy was something that you chose to do yourself. I thought they may suggest that I should sell the house in order to raise the money as my monthly payments won’t be enough but I didn’t know they could enforce bankruptcy through the courts. That was the reason for the initial question regarding transferring the house to my partner - just so the creditor could not suggest selling the house as an option. It’s all a bit of a mess. My partner has completely paid the mortgage for 7 years.  I’m feeling extremely anxious now and the advice given from the debt helplines seems to all come down to the luck of which operator you speak with. 

I have even made enquiries with solicitors for disputing the claim. But it would end up costing thousands. Which if I lost, just adds more to the bill. 

fatbelly

It's particularly difficult to see clearly when you're in the middle of it.

I think the home ownership does need to be sorted  from other angles. If your partner has been paying the mortgage for 7 years then she has acquired an 'interest' in it already.  The issues of council care if you ever need it and inheritance tax probably should be thought about.

When you talked to local solicitors were there any that you thought you could work with? You shouldn't have to commit to thousands at Day 1. If they could just write a letter asking for a full breakdown and reasoning of each element of the claimed amount it would at least give the other side something to think about.

I do suspect this is going to see court action and the courts could be your friend in limiting the damage here. 

Hariba

The solicitors I’ve spoken to have quoted their hourly costs. As it’s such a complicated dispute, for the solicitors to even read all of what’s been argued so far with the ombudsman, it would take hours and hours of their time. One of them quoted a starting point of approx 6k just for doing the background reading. But then went on to talk about court costs and it just escalates! 

I do already have a breakdown of costs that the insurance sent to me. It outlines the settlement figure, loss adjuster fees, building surveyor, alternative accommodation etc. 

madteapot

@Hariba I can see there has been a lot of comments for and against the transfer of ownership and mention of bankruptcy offences. However for a minute you need to look at the home ownership + mortgage responsibilities separately to the debt. 

You mentioned your partner has paid mortgage fully for 7 years and that you are unemployed yet the mortgage is in your name. How long have you been unemployed for? Does your mortgage provider know that you as a sole borrower is no longer employed? And that you are not seeking new employment for family responsibilities and do not receive any benefits? If you have been unemployed for long did the employment/income not come up during remortgage or product transfer application after fixed rate? 
You also mentioned you currently do not have insurance as a new policy is too expensive. Does your mortgage provider know about this? 

Both points above, about your employment/income and lack of insurance are likely to be breaching some form of mortgage condition. Forgetting the debt for a minute you still should be getting your partner to be a joint owner as they are responsible for mortgage payments. This should also help with insurance costs if not eliminate it. 

In regards to the debt, it is still in very very early days and you shouldn't be considering the bankruptcy at this stage. As another poster mentioned let the company first pursue the debt through usual court proceedings. In the meantime make your income and expense sheet (SOA) and offer to pay whatever you can manage monthly. I wouldn't even talk about full and final settlement at this stage as they don't know what you can afford and for all they know you have 100k in your various bank accounts. 

Once they pursue the debt they will start to gauge your finances and if they consider that charging order and/or bankruptcy are too expensive for them to go ahead they are likely to accept lower full and final payment. 

Hariba

setu_desai02 said:

@Hariba I can see there has been a lot of comments for and against the transfer of ownership and mention of bankruptcy offences. However for a minute you need to look at the home ownership + mortgage responsibilities separately to the debt. 

You mentioned your partner has paid mortgage fully for 7 years and that you are unemployed yet the mortgage is in your name. How long have you been unemployed for? Does your mortgage provider know that you as a sole borrower is no longer employed? And that you are not seeking new employment for family responsibilities and do not receive any benefits? If you have been unemployed for long did the employment/income not come up during remortgage or product transfer application after fixed rate? 
You also mentioned you currently do not have insurance as a new policy is too expensive. Does your mortgage provider know about this? 

Both points above, about your employment/income and lack of insurance are likely to be breaching some form of mortgage condition. Forgetting the debt for a minute you still should be getting your partner to be a joint owner as they are responsible for mortgage payments. This should also help with insurance costs if not eliminate it. 

In regards to the debt, it is still in very very early days and you shouldn't be considering the bankruptcy at this stage. As another poster mentioned let the company first pursue the debt through usual court proceedings. In the meantime make your income and expense sheet (SOA) and offer to pay whatever you can manage monthly. I wouldn't even talk about full and final settlement at this stage as they don't know what you can afford and for all they know you have 100k in your various bank accounts. 

Once they pursue the debt they will start to gauge your finances and if they consider that charging order and/or bankruptcy are too expensive for them to go ahead they are likely to accept lower full and final payment. 

The mortgage and house ownership was always something we meant to sort out but just never got round to. The mortgage company don’t know that I’m unemployed. I never really considered it as my partner pays it and there’s never been any issue - stupid maybe, I know! The unemployment was after the mortgage was taken out so it never came up. And no, I’m aware I need to have insurance and I’m trying to resolve this. The mortgage company do not know this either so I am very anxious about any breaches also. 

I’m not considering bankruptcy - someone else mentioned that this may be enforced unpin me. 

For a SOA - I’ve had conflicting advice about whether to put my partners salary on, if I don’t, then I can afford nothing. Is there a standard firm that I should be using? And do I send this to them? Surely I could put anything on it though. How will they check that what I put is correct? 

I can’t see that they will not consider a charging order/bankruptcy. I’m not sure how much this would cost them but the equity in the house would cover the debt so I’m sure they would go ahead with this. 

mem1209

I am no expert in any of the points discussed above, but one thing bothers me: there is a family with children who lives in this house, where the spouse pays for the mortgage, but the mortgage is on the farther's name.
Is this common in the UK/ England, that the Court will allow to enforce bankruptcy on the father and ask to move the whole family on the street or shelter? Even if the spouse and children are not on the deeds / mortgage etc - they do exist! Does it common practice in England to force sell a house full of kids?

gizmo111

Hariba said:

setu_desai02 said:

@Hariba I can see there has been a lot of comments for and against the transfer of ownership and mention of bankruptcy offences. However for a minute you need to look at the home ownership + mortgage responsibilities separately to the debt. 

You mentioned your partner has paid mortgage fully for 7 years and that you are unemployed yet the mortgage is in your name. How long have you been unemployed for? Does your mortgage provider know that you as a sole borrower is no longer employed? And that you are not seeking new employment for family responsibilities and do not receive any benefits? If you have been unemployed for long did the employment/income not come up during remortgage or product transfer application after fixed rate? 
You also mentioned you currently do not have insurance as a new policy is too expensive. Does your mortgage provider know about this? 

Both points above, about your employment/income and lack of insurance are likely to be breaching some form of mortgage condition. Forgetting the debt for a minute you still should be getting your partner to be a joint owner as they are responsible for mortgage payments. This should also help with insurance costs if not eliminate it. 

In regards to the debt, it is still in very very early days and you shouldn't be considering the bankruptcy at this stage. As another poster mentioned let the company first pursue the debt through usual court proceedings. In the meantime make your income and expense sheet (SOA) and offer to pay whatever you can manage monthly. I wouldn't even talk about full and final settlement at this stage as they don't know what you can afford and for all they know you have 100k in your various bank accounts. 

Once they pursue the debt they will start to gauge your finances and if they consider that charging order and/or bankruptcy are too expensive for them to go ahead they are likely to accept lower full and final payment. 

The mortgage and house ownership was always something we meant to sort out but just never got round to. The mortgage company don’t know that I’m unemployed. I never really considered it as my partner pays it and there’s never been any issue - stupid maybe, I know! The unemployment was after the mortgage was taken out so it never came up. And no, I’m aware I need to have insurance and I’m trying to resolve this. The mortgage company do not know this either so I am very anxious about any breaches also. 

I’m not considering bankruptcy - someone else mentioned that this may be enforced unpin me. 

For a SOA - I’ve had conflicting advice about whether to put my partners salary on, if I don’t, then I can afford nothing. Is there a standard firm that I should be using? And do I send this to them? Surely I could put anything on it though. How will they check that what I put is correct? 

I can’t see that they will not consider a charging order/bankruptcy. I’m not sure how much this would cost them but the equity in the house would cover the debt so I’m sure they would go ahead with this. 

I'm not aware that you have to inform the mortgage company that you are not working, and are staying home to raise a family.  000's of families have changes in circumstances like this and there are no problems unless the mortgage falls into arrears.  Your partner however has been paying the mortgage and will have a beneficial interest in the property and this needs to be protected for him/her.  The lack of insurance is a big concern though.
I would speak to a mortgage broker, see if you can remortgage and raise possibly raise a lump sum of £25,000 and then see if the creditor is open to taking that as a Full and Final settlement.  The mortgages and endowment boards on here have some very knowledgeable brokers.