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| w.b |
Posted - 04 July 2009 : 11:48:08
My wife and i own 7 properties including our own home. They are all in negative equity and some are unmortageable. We cannot keep the payments of our credit cards, however the rents cover the mortgages and we live off whatever is left from the balance. There are 2nd charges on some of the properties. If we declare bankcrupty would we lose the houses in which case we would have no money even to live on. None of the mortgages are in arrears and we are only about 2 months behind in our credit card payments all these months we have been upto date and we can continue to keep up the mortgages from the rent. Please advise. |
| 7 L A T E S T R E P L I E S (Newest First) |
| Reviva UK |
Posted - 07 July 2009 : 15:11:49
Hi
if you have negative equity then there is no chance of selling and renting back. they usually want to buy at 60 - 70% of market value so no benefit there.
the only reason to loose your family home is to be unable to purchase the Beneficial Interest form the OR after Br, or be unable to meet the mortgage payments.
The important thing is not to panic, slow down the process and get a full understanding of ALL of your options.
It may be that Br is not the right solution but rather an affordable debt management plan until house prices change and equity becomes available again.
alternatively Br may be the right solution.
Understand ALL of the options, apply them to your own personal situation and how they effect the family, future aspirations and see which solution to debt is ultimately the right one for you.
Hope this helps a little
Paul
Paul Johns
Bankruptcy Specialists
Reviva UK
www.revivauk.com
Real People ..... Real Debt Solutions |
| Niobe |
Posted - 07 July 2009 : 12:49:58
I kept mine, but won't ever sell it.
The glimmer gets brighter all the time
Jan
xx |
| Jane.l |
Posted - 07 July 2009 : 12:37:53
We only lost our house because we chose to, I suppose we could have bought the beneficial interest if we had wanted to but it was not worth it, the mortgage and secured loan payments were too much and the house needed work. We are now in a better area and a nicer house for £1000 per month LESS than what we paid before.
I also got to keep my private number plate, that was also an asset in the bankruptcy but the OR said that I could keep it, it has since trebled in value so is now up for sale, thank you Mr OR  |
| Niobe |
Posted - 07 July 2009 : 12:17:09
Quite agree Jane.
I certainly wouldn't touch any of those 'buy your house' people - they are rip off merchants just out to make money for themselves from the desperate.
Hopefully one of the experts will be on with advice.
The glimmer gets brighter all the time
Jan
xx |
| Skippy |
Posted - 07 July 2009 : 12:15:22
Jane is right. That's a very sweeping statement Gary and could scare people unnecessarily.
If you are a home owner in negative equity it's possible to buy the beneficial interest for £1 plus costs, and if you have equity someone else can make an offer for the BI. Either way would mean you could keep your home providing you can keep up the mortgage payments.
You don't always lose other assets either - if you need them for work they can be classed as tools of the trade. If you have a car that you need for work you will be able to keep this as well, providing it's not over a certain value. If it's worth more than the OR's limit it will be sold and you will be given a sum of money to buy a replacement.
Tomorrow is a mystery, yesterday is history, today is the present, a gift to make the most of.
View my blog at http://skippy13.blogs.bankruptcyhelp.org.uk/
24 IPA payments made, 12 to go - on the home straight! |
| Jane.l |
Posted - 07 July 2009 : 11:52:53
"Going BR means you will lose all your assets, even your home which will be the last thing to go."
This is not necessarily true, that is why it is so important to get the correct advice before comtemplating bankruptcy. |
| Jetstar125 |
Posted - 06 July 2009 : 15:44:42
Hello and good day.
I trust the following will help you.
Firstly being 2 months behind with credit cards is no big thing, I would suggest you tell (not ask) the credit card companies that your monthly paymemts will be £1 per month from here on in.
Currently your CC debt is unsecured, so something in for them is better than nothing in for them.
Negative equity.
I've yet to see a formula (magic or otherwise) for dealing with negative equity, other than to be told to sit tight as the market will eventually come back.
I think it is brilliant you have kept up the payments dispite the climate and I wish you every best wish as you continue.
However, be mindful of a few things.
Interest rates will eventually move upwards and this could have a bearing on your mortgage repayment amount.
Parties with 2nd charges do not work with the principle lender, so keep an eye on the 2nd charge terms of business. You may well be in control of the 1st mortgage, the 2nd charge lender could change their terms, like interest rate, late fees etc.
A friend of mine is into negative equity of a few million, however he is cash flow positive as rents are surplus over mortgage fees. None the less his property portfolio is insolvent and he can't refinance any of it.
If you are sure that your tennants will pay rent each month, then I suggest you start shoring up what cash you have and keep it for a reserve fund.
It seems to me that you are of a mind to go BR as clearly you understand that eventually negative equity will have to be dealt with no matter what rent comes in or what mortgage payments go out.
Ultimately it all depends on your circumstances and time of life. What I woud ask you to consider is this.
Is it worth holding on and making do in what is still a tumultuous economic climate? any refinancing option could well be a financial prison sentance, or accept that negative equity (and there is alot of it) will have to be dealt with and simply bit the bullet and go BR.
Going BR means you will lose all your assets, even your home which will be the last thing to go.
Have you tried these "We'll buy your house" websites? they offer way below market value, but it might be worth a shot.
Good luck.
Gary |
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