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fredjn
Starting Member
30 Posts |
 Posted - 24 August 2009 : 11:15:37
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Hi after taking advice, professional and otherwise we have decided to go bankrupt. We currently have a morgage that we can pay right now but when the interest rate rises we would be unable to. There is perhaps 750 - 1000 equity maybe a little more depending on where you get the estimate. We have come to terms with losing the house now as we know that over the next 22 years it is unlikely we could keep up the payments.
Now our question is it best to stop paying the mortgage now and find somewhere to rent now? Or stop paying mortgage to save up six months deposit on a rental property? Or should we continue paying mortgage and wait for the OR to sell the house? We don't want to go bankrupt and be left with a house we can't pay for and end up getting repossessed after the bankruptcy being left with a massive shortfall.
Any advice grafetfully received.
Thank you
O
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gettingoutofdebt
forum expert
2418 Posts |
Posted - 24 August 2009 : 11:31:49
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If you have decided to declare BR and give up the house then there isn't really any point in continuing with the mortgage repayments. Any equity would be taken by the OR and they would go for a quick sale so the asking price would probably be lower than the equity.
There is no need to move out of the property immediately as it will take several months for the mortgage company to go down the repossession route. Start saving for your BR and rented accommodation deposit and then either just before or just after you declare BR you can move out of the house and into the rented property.
A few people move out of the house a week or so after declaring BR as this means that their rented address isn't associated with their BR and also their landlord isn't contacted by the OR. This can sometimes happen as the OR wants confirmation that there aren't any rental arrears. |
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Jane.l
Average Member
511 Posts |
Posted - 24 August 2009 : 11:35:56
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A point to bear in mind is if you leave it too long before renting a house, your credit rating will be bad and your choices of rental properties may be reduced because of this, many letting agents do credit checks
For this reason, we decided to get out early and securing a house was more important to me than saving up more money, but its up to you
We left 7 months before going bankrupt, and our OR did not inform our landlord, dunno why or if we were an exeption but we had no arrears |
Edited by - Jane.l on 24 August 2009 11:37:07 |
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fredjn
Starting Member
30 Posts |
Posted - 24 August 2009 : 11:42:31
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Thank you for your replies. Another question will we get into trouble with the OR deliberately not paying the mortgage to rent elsewhere?
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Jane.l
Average Member
511 Posts |
Posted - 24 August 2009 : 11:51:06
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Not at all, if you have decided you cannot keep the house, there is no reason to pay the mortgage any more, you will just be chucking money away, the mortgage company will harass you and tell you that you must pay etc, which legally I suppose they are correct but once you have given up the house and gone bankrupt, any arrears, interest etc will be written off, so now is the time when you have to be strong, it is hard, I found that time really stressful so my advice would be to not deal with them on the phone, put in writing to them what you are planning to do and then ignore any phone calls, they are the worst. Had me in tears and a nervous wreck on many occasions  |
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fredjn
Starting Member
30 Posts |
Posted - 24 August 2009 : 13:20:22
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Thank you for your replies we truely appreciate them. We have not told our family of our plans as we are just too ashamed. Its nice to have found this site so we can ask question as we are very scared about what we are about to do.
We know its the right thing to do as we have a little girl to think of and my hubby healthis none to ggod this year for example despite a kidney transplant in february this year he has already had three other surgical procedures for different problems and a very bad bout of the swine flu. he doesn't get sick pay so this loss of income all the time added to ill health is very very stressful. He had renal failure for the six years prior to this, we have had three redundancies aswell and we have robbed peter to pay paul, consolidadted, you name it everything to make payments. We should have given up a long time ago.
Pride an awful thing.
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Housing
Senior Member
United Kingdom
1399 Posts |
Posted - 29 August 2009 : 15:52:28
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Hi fredjn 
The situation you are in is nothing to feel ashamed about. There are more people in our position than ever before.
I appreciate that pride is a feeling we all have - but your health, your family and getting through the next stages are what is important.
I speak as someone who had a successful business and borrowed too much and had to cease trading - at 57 it was very hard - but once I knew that BR was the only option, we dealt with it - it is not an easy thing to do. but please do not feel ashamed and pluck up the courage to tell your family/friends - nobody will think bad of you.
It does seem that life kicks you in the teeth every day - stick together.
Today, I have checked the balance in my Co-op cashminder account - I manage the funds well and make sure there is always a few ££ in there - never over about £70 or so.
I have some direct debits due out on Tuesday and i find that the DWP have credited £0.20p in my account this week instead of £128.60!!
I felt like screaming and crying, yes crying with frustration and anguish - my wife who is not BR also has a Cashminder account and she transferred £80.00 by phone to ensure the bills are paid and not refused by the bank!!
I will now have to spend hours on Tuesday (a bank holiday weekend) getting onto the DWP to see what they have done - it will have cost them more than the £0.20p to make that credit to the account!!
In the overall scheme of things it is not very much, but there are times when you feel the whole world is against you - I guess that is how you are feeling?
This site is fantastic to share your problems get advice and share experiences - keep positive and I am sure things will level out.
Good luck to you and your family, Richard
"There are no problems - only solutions..." |
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House - what should we do?
