Newbie needs advise, in serious debt!

sara84

Hi there, i come on here everyday reading everyone's posts and advice on BR and it has been very useful but now im looking for a bit of advice myself.

I am 23, have a 16 month old baby and another which is due in may next year, I have been on income support since my partner left in June. This is the only money i have coming in apart from the £10 top up i get through the CSA.
I live in our jointly mortgaged home, which my partner is paying the mortgage on and a secured loan in joint names. I just pay the household bills etc.
In the current market id say there was little or no equity in the house, market value about £175k and we owe £172k mortgage and loan.

Right now for my debt, it was all taken out before i had my child when i was working full time and i now can not afford to pay it. I have about £13k of unsecured debt, loan, credit card & 2 store cards.
I also have about £40k of joint debt with my X Partner, unsecured part of a previous Northern Rock Mortgage, remains of a repo car finance.

I can not see any other way out of this other than BR and i have spoken to CCCS a while ago.

I would like to know if any of you could advise me, will I need to leave my home? It is in a nice area close to my family which i will need round me when the baby arrives, i dont drive and the public transport is near non existant. I know it has been mentioned on here before about getting someone to buy my BI, but will the OR offer this as on my own i couldnt afford to pay the mortgage or loan. My X is also thinking of BR but this will not be for a few years yet.

Broken_hearted

Have you spoken to your ex as if he's in a position where he needs to go BR how is he going to continue the mortgage payments in the future and house himself.

sara84

Hi, yeah we have discussed it in length, it is not a definate that he will go BR yet. He is happy paying for the mortgage/loan in order to keep a roof over our heads and his children to grow up in a nice area. He lives with his grandfather at the moment, but he works away for months at a time abroad so he is rarely in this country for long periods.

Broken_hearted

The joint debts will all need to be paid by him if you go BR, since there is no equity in the house the OR most likely will let someone buy out your interest.
If you could manage it next year lean to drive, it will help you in many ways, confidence, getting around with the kids and looking for work in the future. Good luck with the new baby.

Richard_S

Hi sara,

How much is the secured loan for?

If it's not a significant amount, and there's little or no equity in your house, then you shouldn't have a problem.

The only problem could be, if the O.R thinks that the amount you're paying for the mortgage and the secured loan is unreasonable in terms of what you could rent a suitable alternative property for, then they may require you to sell the house. That is the worst case scenario of course.

How much could you rent an alternative property for compared to your mortgage repayments and secured loan? If there's not much in it then it should be relatively plain sailing.

Richard

Broken_hearted

But Richard she isn't paying for the house and you can't rent for free.

Richard_S

Broken_hearted wrote: »

But Richard she isn't paying for the house and you can't rent for free.

Hi Broken hearted,

My understanding was that it was a jointly owned property. How they split the expenditure doesn't really matter given that Sara is on benefits.

I did forget to ask whether Sara's partner was considering bankruptcy, I assumed he probably was.

Richard

sara84

Thanks for your replies.

House value £172k (there is a same style house up for £165k at mo)
Mortgage £156k
Secured loan £15k

The mortgage is in joint names but my partner pays the full amount, he always has. He pays:
£800 + £50 towards arrears
£140 loan

Rent varies in the area anything from £650 - £1000, but i would obviously find it hard getting a rental with no income and a very poor credit history. I would have to apply to the council, which would probably mean moving quite far away from my family.

Richard_S

sara84 wrote: »

Thanks for your replies.

House value £172k (there is a same style house up for £165k at mo)
Mortgage £156k
Secured loan £15k

The mortgage is in joint names but my partner pays the full amount, he always has. He pays:
£800 + £50 towards arrears
£140 loan

Rent varies in the area anything from £650 - £1000, but i would obviously find it hard getting a rental with no income and a very poor credit history. I would have to apply to the council, which would probably mean moving quite far away from my family.

Hi sara,

You and your partner live together and you have debts associated with a former partner; is that right?

If it is, then I can't see you having problems with keeping the house. The mortgage and secured loan payments are in line with what you'd pay if you were renting and there's little if any equity in the house.

I'd guess you're probably just managing to get by after paying your essential expenditure, so you're unlikely to get an IPA.

Having said that, as with anything to do with property, I would consult either a solicitor specialising in insolvency or an Insolvency Practitioner. Depending on your income you may qualify for legal aid and some I.P's will give you a free initial consultation.

You can't do too much research when it comes to property.

Richard

sara84

Hi Richard,
No sorry if im confusing everyone. I now live on my own with my baby, my X Partner left us and he lives elsewhere when he is in the country. My X pays for the mortgage/loan which is in my name & my X partners.
So basically Im living in my jointly owned home alone with the kids but i dont pay anything towards the mortgage/loan, i just pay the household bills etc.