Help Wanted with Finances

doodlebug1_2

About five years ago I met a lady who has since become my partner. As we both left our wife/husband with nothing except our clothing I took out a loan to set up our new home. I wanted to change the car for a more economical one. The loan was for £10,000 and I still owe £9,000. I have about £4,000 outstanding on my Virgin credit card and the introductory rate has now finished.This means that each month I am paying about £40 extra in interest. I have one year left to go on my motorcycle payments at £109 per month. I can not sell it because it is on HP? Everything was OK until last year when, out of the blue came a solicitors letter with regard to a house that my partner and her husband had had repossessed, at the time, 11 years ago. I have since found out that the statutory period of time for reclaiming this debt is 12 years. My partner thought, naively, that because the property had been taken back that that was the end of it! Any way it went to court and she has a County Court Judgement against her and has to pay approx. £120,000.00 at £110 per month. She will be 99 when this is paid off!!

I wanted to change credit cards for a 0% one but I can't because we have a "financial association", I guess because we have a joint account just for the rent.
My partner has been advised, by the judge on one of her visits to court, to declare herself bankrupt. Our questions would be: is this the best course of action, how will I be implicated in this even on a financial level,( she feels it's not right for me to pay for her and her husbands problem), and what will happen to our tenancy which is in her name. It is an assured short term(6months) tennancy with a private landlord.
Our monthly outgoings are:- £520 rent, £148.18 to Abbey National, £19 Insurance, £52 for Partners Gym membership per month ( I would say that this is neccessary for her mental health?),£30 Electricity per month,£10 Specsavers for lenses, £40 for heating oil , £115.11 for Council Tax, £109 for motorbike, food £70 avg. per week. We each have a car for going to work. I am self employed and last year earned approx £20,000. My partner is salaried and earns £19000.
She has received a letter, this morning from Abbey National, to say that her overdraft of £1500,00 is up for review on the 1st November and will be lowered to £600. We have to find £600 to pay off by then.
I think I've covered everything and would thank anyone who can help us with our problem
Regards
Doodlebug1

tomstickland

I'm no expert but declaring bankruptcy is not an easy option from what I've read and seen on "bank of mum and dad"(!).

Does her ex husband owe anything on the repossesed property? I don't understand how she owes so much? Surely the propery had some value when repossesed.

You both earn around £20K, so that must be around 3K per month coming in.
So you could actually pay £2K per month into debt recovery. ie: clear your credit card and her overdraft?

You could also sell one of the cars and use the money to eradicate as much of the car loan as possible.

angelatgraceland

Try this link and see if its helpful. Ive no idea if they are any good or not but they sound good. I recommended them to a friend the other day after searching various sites on here. They are a charitable organisation and are not a debt consolidation company. Freephone number so you dont run up yet more debts! http://www.cccs.co.uk/

doodlebug1_2

Hi Tomstickland
Her husband is "of no fixed abode and unemployed" as far as the court is aware. The house was valued at about £45,000.00 but was sold for £32,000.00. Obviously interest has bumped this up.
Thanks for your interest
Doodlebug1

tomstickland

So they sold the house for £13K less than it was worth and eleven years later they suddenly turn up asking for £120K due to compound interest. Very convenient for them to leave it that late then.
It's such a large amount that if it was me then I'd opt for bankruptcy I think. Obviosuly get professional advice though.

Spendalot_2

Im with timstickland - I would go bankrupt. Suggest you look for posts here with people who have been through the process to see whats involved.

This is surely a case where what has happened is morally wrong (on the banks part). How on earth can they justify 120k!

I think you would need to justify that it is just not possible for your partner to repay the money by producing a income and expenditure summary (Statement of affairs).

I would stop making payments to the house recovery, and hopefully they will then make her bankrupt saving her the court fees. I also think that she would find that the judge is sympathetic, this is a ridiculous case.

Debt_Free_Chick

doodlebug1 wrote:

About five years ago I met a lady who has since become my partner. As we both left our wife/husband with nothing except our clothing

Did you each proceed to get divorced from your former husband/wife?

Everything was OK until last year when, out of the blue came a solicitors letter with regard to a house that my partner and her husband had had repossessed, at the time, 11 years ago. I have since found out that the statutory period of time for reclaiming this debt is 12 years. My partner thought, naively, that because the property had been taken back that that was the end of it! Any way it went to court and she has a County Court Judgement against her and has to pay approx. £120,000.00 at £110 per month. She will be 99 when this is paid off!!

What does she mean that "the house was taken back? If she is now divorced, was this repossession before or after the divorce? And if she divorced, who had possession and ownership of the house?

My partner has been advised, by the judge on one of her visits to court, to declare herself bankrupt. Our questions would be: is this the best course of action, how will I be implicated in this even on a financial level,( she feels it's not right for me to pay for her and her husbands problem), and what will happen to our tenancy which is in her name. It is an assured short term(6months) tennancy with a private landlord.

Check your tenancy agreement to see if the landlord has the right to evict you due to bankruptcy. Could you change the tenancy agreement so it's in your name instead?

Many landlords don't care if you're bankrupt, so long as you keep paying the rent. She could always approach the landlord and assure him that she can continue to pay the rent for the future, but that bankruptcy is necessary to deal with old historic debts.

Even if you are made bankrupt, there are plenty of other landlords who will rent to you. Some even specialise in renting to bankrupts - you only need to visit the County Court to see the adverts for this.

Our monthly outgoings are:- £520 rent, £148.18 to Abbey National, £19 Insurance, £52 for Partners Gym membership per month ( I would say that this is neccessary for her mental health?),£30 Electricity per month,£10 Specsavers for lenses, £40 for heating oil , £115.11 for Council Tax, £109 for motorbike, food £70 avg. per week. We each have a car for going to work. I am self employed and last year earned approx £20,000. My partner is salaried and earns £19000.

Your budget will need to be much more comprehensive for you to see where your money goes. Do you have a budget for all your motoring costs? Do you have money left over at the end of the month, or month left over at the end of the money?

She has received a letter, this morning from Abbey National, to say that her overdraft of £1500,00 is up for review on the 1st November and will be lowered to £600. We have to find £600 to pay off by then.
I think I've covered everything and would thank anyone who can help us with our problem
Regards
Doodlebug1

If the overdraft is £1500 and Abbey want to lower it to £600 you have to find £900!

Call Abbey National and ask them if they will, instead, reduce the overdraft by £100 each month for the next 9 months. This way, you only have to find £100 a month of savings in order to reduce the overdraft. Tell Abbey that you simply don't have and can't find £900 immediately to address the lowering of the overdraft. If they agree, get it in writing.

For general information about Bankruptcy, read THIS from the National Debtline

doodlebug1_2

Hi Debt Free chick
We are both still married to our husband/wife. :eek: By taken back she means repossessed. I have been onto National Debtline as some of you have suggested and they are proving very useful. thanks
Doodlebug1