Being chased for debt on mortgage shortfall after repossession and 7 years after bankruptcy?

Alanhall1002 · 11 September 2019 at 12:43PM

Hello,
I am looking for advice from anyone who can help.
7 and a half years ago (Mar 12) I was declared bankrupt. I stopped paying my mortgage and informed my mortgage provider that I was handing back the keys of the property. Having done this my house was repossessed and subsequently sold.
I have just now received a letter from a Moorcroft debt collection company advising me that they are operating on behalf of my former mortgage provider and looking to collect a £20000 shortfall on my previous house.
I simply want to know if this is genuine and I am still liable for a shortfall after the mortgage and house were included in my bankruptcy over 7 years ago?
Any information would be greatly appreciated.

MovingForwards · 11 September 2019 at 3:36PM

What order did you do things?

Was it stop paying the mortgage, hand the keys back then go bankrupt?

Or

Go bankrupt, stop paying the mortgage then hand the keys back?

Limitation for mortgage is 12 years, unlike normal civil lit/debt which is 6 years.

Minkym00 · 11 September 2019 at 4:22PM

Surely its a contingent liability and the order doesn't matter? The debt was incurred when the mortgage was taken out (i.e. pre-bankruptcy) so it makes no difference if the shortfall occurred before the bankruptcy order or after.

luvchocolate · 11 September 2019 at 4:28PM

Minkym00 wrote: »

Surely its a contingent liability and the order doesn't matter? The debt was incurred when the mortgage was taken out (i.e. pre-bankruptcy) so it makes no difference if the shortfall occurred before the bankruptcy order or after.

I was going to reply with the same answer, then started to doubt myself.
I would send the debt collector a copy of your B.R order.

Minkym00 · 11 September 2019 at 4:31PM

A mortgagee or other secured chargeholder may request the bankrupt to sign a document acknowledging the level of debt, shortfall or similar. Such a document is generally known as a deed of acknowledgement.

If you completed such a deed, a new debt might be created on which recovery action might be based at any time within the limitation limit.

Whilst a post bankruptcy debt can be created by rescheduling and deed, the underlying debt it is still a bankruptcy debt.

Alanhall1002 · 11 September 2019 at 8:48PM

Thank you for the quick reply.

I was made bankrupt and then stopped my mortgage payments and handed in the keys.

Alanhall1002 · 11 September 2019 at 8:52PM

Thanky you for the quick reply.

I have contacted the debt collection company providing details of the Bankruptcy Order today. Will see what response I get from them.

debt_doctor · 11 September 2019 at 9:26PM

Hi,

This is a bankruptcy debt as a contingent liability (as said earlier). There is this thing of a potential new debt by signing a deed of acknowledgement after BR, but it seems you didn't sign one and any legitimacy of such a deed has not reached any case law that I am aware of.

As far as I am concerned, your shortfall debt is a bankruptcy debt and you are not responsible for it. End of.

Keep us informed.

DD

maxmycardagain · 15 September 2019 at 4:40PM

God loves a Trier (Moorcroft in this case)

Clive_Woody · 18 September 2019 at 12:38PM

maxmycardagain wrote: »

God loves a Trier (Moorcroft in this case)

I checked and can confirm, that no he doesn't.

He will be sending them a plague of locust shortly :money:

Being chased for debt on mortgage shortfall after repossession and 7 years after bankruptcy?

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