Author Topic: Bankruptcy/Repossession advice pls pls help  (Read 6678 times)

dumbblonde

  • *
  • Posts: 1
Bankruptcy/Repossession advice pls pls help
« on: Jun 29, 2009, 09:59:50 AM »


Hi there,

This is a bit of a long one but here goes...

We currently own an apartment which is in roughly 20 thousand negative equity. My husband just lost his job along with a diesel allowance and they also payed his car insurance. He now has another job but we just cannot afford to travel a round trip of 40 miles per day each (I am a mobile hairdresser also working 20 miles away from our current home.) We only moved so far away to get on the housing ladder, but as the market has crashed we are now stuck here paying an extortinate mortage (658 a month) plus service charges, ground rent etc. Long and short of it is we cannot afford to live here anymore and have no interest in keeping the property as we are struggling with about another 17 thousand in bank loans, car loans, hire purchase and credit cards etc not to mention food bills and fuel etc.
We have found a house to privately rent in the area we work, and are just waiting for a moving in date..We are almost definately decided on bankruptcy and I have not taken the decision lightly.

1. Should we go for voluntary repossession? We can't afford to pay the mortgage this month so do we just stop paying altogether or offer a small amount?

2. Our credit cards,Hire purchase, loans etc...do we continue to offer a small token payments or is there any point to this?

3. How soon can we file for bankruptcy so that the shortfall from the negative equity will be included? would it be better to hand keys back as soon as we move into new house?

3. Will the bailiffs take my car (worth about 800 pounds) as I need it as I am a mobile hairdresser? Also will they take our telly etc? What will happen to my husbands hire purchase car? We owe about 8 thousand on it and it is only worth about 3 thousand...We have resigned ourselves to the fact we will probably lose this.

I suppose I just need to know what order to do things in!
Thanks for listening to my rant...I just feel so sick at the moment :-(

smallville

  • Jr. Member
  • **
  • Posts: 15
Re: Bankruptcy/Repossession advice pls pls help
« Reply #1 on: Aug 03, 2009, 04:09:16 PM »
Hello There,
Interesting screen name :)

I was in the situation of owing £63500 worth of debts with no assets so went for bankruptcy.
For me personally I did continue to make token payments but kept them to a minimum and still they harassed me for more so don't really see the point in making them... I may be wrong on this though and it may keep them off your back for longer.
I wouldn't worry too much about bailiffs as it takes a long time to get to this stage. I was in none payment debt for a year and no one mentioned this. The creditors will sell the debt on first to collection agencies and I believe (but don't quote me) they will go for CCJ's before hand. (I didn't even get to this stage)
Also with bailiffs (I believe) they cant touch you unless you open the door to them.
Regarding the mortgage have you spoken to your bank to see if you can get a repayment break? explain the situation and they will try to help.
Regarding debt, people don't communicate with creditors and doing so can often help.
You may be able to find a way out of debt through communication and using an income and expenditure form.
Also speak to the CCCS who will probably recommend an IVA to help keep your house if possible and help you devise a budget plan.
You can reduce this kind of debt dramatically around (50 - 75 % realistically) and possibly find other alternatives.
I went bankrupt as I didn't have a house but would of reconsidered if I did.
Could you rent out the house you have to cover the mortgage and possibly gain a little extra income?
Then move into cheaper accommodation to increase your deposable cash?
Can you use any other methods to gain extra income or minimise your outgoings?
Also at this stage contact all creditors to freeze interest explaining the situation.
You can also get debt freeze letters and letter to send them from google so they dont keep harrassing you.

Look at bankruptcy as the final straw, that's what it is.

Good Luck

P.S. final thought, if your struggling on your mortgage can you get a loan from family / friends to cover this?
Before committing to bankruptcy go to the CCCS and remember you don't have to take their advice though.

gordonblair81

  • Full Member
  • ***
  • Posts: 23
Re: Bankruptcy/Repossession advice pls pls help
« Reply #2 on: Aug 03, 2009, 04:32:37 PM »
Hey Dumbblonde

Firstly your property i do not see any point in keeping this property even if you were to rent it out how long would it be before you make your £20K neg equity back ??? i would stop paying mortgage and post keys back to the mortgage company asap also give them a call and let them know you are doing this they may try and help you etc but how can they help with a 20K shortfall.

Once they have put the house to auction there will be a shortfall which will then become an unsecured loan (no property to secure itr over anymore) certainly sounds like the best thing to do with moving closer to work petrol is not cheap anymore nor has it ever been to that matter.

can you let me know if you are in England or Scotland as different laws in both countries ?
I can only imagine you are receiving calls and letters from creditors just now so really what is the point in making token payments when the money could be used better elsewhere.

In regards to yuor partners car if this hire purchase agreement is more than half way through the finance term you can hand this car back to the finance company with no cost to you or your partner however in a bankruptcy they will look into the car and determine the worth if valued at more outstanding on finance then this will be sold. if you are currently not paying the monthly payment to the car then more than likely the hp company will come after repossession eventually - are you sure this is a hire purchase agreement ?.


Regards

Gordon Blair

bankruptcy.co.uk

  • Sr. Member
  • ****
  • Posts: 90
Re: Bankruptcy/Repossession advice pls pls help
« Reply #3 on: Aug 16, 2009, 01:24:34 AM »
Dumblonde.... Here are the facts.

Bankruptcy will write off all of your debts.

Bankruptcy will allow you to keep your house (as it is in negative equity), IF you keep making the remortgage payments. If you dont, then obviously you will have to lose it anyway.

Bankruptcy will allow you to keep your car as you use it for work and it is of less than £1500.

Bankruptcy costs only £510 for the court fees and all your debts are gone.

There are a few downsides such as income payment arrangements etc, a shortfall of your credit rating, and you would not be able to get a mortgage / credit for a while.
Raphael Gilbert
Head of Insolvency Divison www.ban

cloverfan09

  • *
  • Posts: 3
Re: Bankruptcy/Repossession advice pls pls help
« Reply #4 on: Aug 28, 2009, 01:20:31 PM »


There are a few downsides such as income payment arrangements etc, a shortfall of your credit rating, and you would not be able to get a mortgage / credit for a while.


please could someone explain the income payment arrangement bit to me as i too am considering bankruptcy but really feel as if i dont know as much as i should?? also has anyone heard of the company drd? are they any good? they seemed good on the phone but i scared of making this leap on my own with no one to discuss things with.

Dumblonde....just a thought perhaps as a mobile hairdresser u could build a client base closer?

bankruptcy.co.uk

  • Sr. Member
  • ****
  • Posts: 90
Re: Bankruptcy/Repossession advice pls pls help
« Reply #5 on: Oct 05, 2009, 11:58:00 AM »
An income payment arrangement or IPA is 3 year arrangement with the government whereby you pay an agreed amount to the goverment (who then pays your creditors) for 3 years.

If placed in an IPA you have no choice but to make these payments for 3 years.

The method by which a bankruptee is placed into an IPA is in section 7 of the bankrupts petition.

This section asks you to fill your incomings and outgoings.

If the difference between your incomings/outgoings is £99 or less, then you will NOT get an IPA.

If the difference between your incomings/outgoings is £100 or more then you pay a percentage of this to the government.


Some examples...
Disposable Income of £100 = IPA of £50.

Disposable Income of £200 = IPA of £100

Disposable Income of £300 = IPA of £180

Disposable Income of £600 = IPA of £420.

The advantages of using a specialist company for filling in section 7 of your petition is obvious. Specialist companies know the legal maximums that you can claim for each allowable expense and therefore lower the likelyhood of an IPA and also ensure that if you do get one, it is the lowest possible :)
Raphael Gilbert
Head of Insolvency Divison www.ban