raising money B4 going BR

donethelot

Me..Married with 3 young kids.

Joint interest only mortgage 300k, Value of property 450k.
(I have remortgaged twice to pay back unsecured loans)
Lost a lot of money on a business venture.
I owe debts on cards and unsecured loans of £130k.
All the debts are in my name, my wife has no debts.
Outgoings with minimum payments are £6k pm, earning approx £3-4k pm, making up shortfall by getting further into debt. Need to finally put a stop to this downward spiral.

Option 1. If I go BR now we lose the house as we wont be able to raise the £75K equity to pay the OR for my share. We end up homeless!
Option 2. Remortgage for the max amount, split the proceeds 50/50 with my wife which she can bank. Blow/spend my share.
My wife can then purchase my share of the equity from the OR and we keep the house.

IVA doesnt work and this seems the only way to keep a roof over my familys head..........any ideas how will the OR view this?

G-G_4

I don't think that is an option, the remortgage to the limit part as the OR (in my opinion) would see that as either disposing of assets, or reckless behaviour to your advantage, or both!

You are going to have to face facts that you may lose the house if you decide on going bankrupt. It must be difficult and I sympathis with you, I really do...

Have you taken advice from anywhere yet? This may help you get an idea of what your options are..

Best Wishes

fiveyearplan

If you go BR and you have £150,000 of equity in your home don't forget you subtract solicitor's expenses, estate agent's fees etc so that would leave less than the £150k equity. Then there is always the chance that your home has gone down slightly in value over the past few months which makes your 50% even less. Is there anyway your wife could remortgage for the shortfall? You may be looking at £60-£70,000. If you really want to stay in your home, look for all the options. You will have a year to come up with the money - especially if you have dependent children.

Or... you could use your wife's equity to buy a new house? Whichever you choose, your monthly outgoings are going to be a lot less without all that other debt. There are many people on this board who have gone through this. Rog2 has just successfully negotiated and kept his family home.

Good luck and keep posting.

Oldernotwiser

donethelot wrote: »

this seems the only way to keep a roof over my familys head..........any ideas how will the OR view this?

Don't confuse keeping this house with keeping a roof over your family's head. There are other,cheaper houses and excellent properties available to rent. Your current house is not all there is.

Scarlett.1974

Oldernotwiser wrote: »

Don't confuse keeping this house with keeping a roof over your family's head. There are other,cheaper houses and excellent properties available to rent. Your current house is not all there is.

I totally agree with this

I really wouldn't recommend what you're thinking of doing, I'm sorry. You're talking of raising your mortgage from £300k to £450k - even without your unsecured debt (if you do go BR) will you be able to comfortably afford the repayments on this? Don't forget - once you go BR there is NO more credit available, you'll have to live within your means, budgeting for everything, buying nothing unless you have the actual cash there. What about interest rises, will you be able to take these into account? On a £400k mortgage every rise could be VERY painful. And you said it's interest only - what about provisions to pay off the amount still owed at the end?

I'm so sorry, that's sounded like a right old nag from me I just wanted to make sure you've really thought this through.

tigerfeet2006

Your first port of call should be to contact one of the Debt Charities; see links below. Their services are free; they have no vested interest to serve; their advisors are professionally trained and the advice they give will be objective and in your best interests only. CCCS operate a system of telephone appointments that are designed to be flexible and don’t require you to attend an office based interview. At the CAB you will need to make an appointment with a specialist Financial Advisor; other advisors may not have the specialist knowledge you’ll need.

http://www.cccs.co.uk/

http://www.nationaldebtline.co.uk/

http://www.citizensadvice.org.uk/index.htm

If you’re advised that bankruptcy is the most suitable solution to your financial problems then we can offer the best support and anecdotal advice that you’ll find anywhere on the Web.

For more specific advice and support, in an environment that is managed by people with first hand experience of bankruptcy, and moderated to ensure that no deliberately inflammatory or abusive posts are made then please visit:

http://bankruptcysupportersclub.co.uk/default.aspx

Just remember, as desperate as you may feel at the moment, we have all experienced what you are going through at the moment and with the right support and advice things will improve. It’s not an easy route to take but it is a route that will put you back in control of your life rather than just reacting to events.

donethelot

Thx for the replies.

Still pondering what to do.

tigerfeet2006

Why not pick up the phone right now and speak to National Debtline . Talk to a real person about your options and where to go.

ash_bash_girl

Hi there,

I agree with tigerfeet2006 you must speak to a professional asap to discuss your options.
I loved my home but at the end of the day it is bricks and mortar, as long as my hubby and kids are with me i would live anywhere.
seek help to get the optiona available and you will know which option to go with as it will feel right.

Good luck

lewt

why not sell the house and use the profit 150K to pay off your dents and start again.. ?

squirrel_pigeon

lewt wrote: »

why not sell the house and use the profit 150K to pay off your dents and start again.. ?

Although £75k is your wife's, you could use your £75 to negotiate full & final settlements with your creditors? Or at least get rid of enough to make the debt manageable with a DMP?

Whatever you do, don't remortgage and blow your share. You will either be refused BR or get a BRO (and remember, they can slap one of those on you for 15 years...). Then you would be stuck with a gigantic mortgage and up the creek as soon as interest rates rose.

As you are paying an Interest Only mortgage, it may be in your best interest to sell and cut the ties. How on earth are you going to repay the capital otherwise??