my husband went bankrupt over a year ago and is now discharged..i bought his share of the value of our home for about £90..so very little equity in the house. we took out a secured loan on the property to help with our business which went bust.we have kept up the mortage payments.but the bank now wants us to pay £400 a month off the loan..we told then this is unrealistic and offerd £150 which they have repeatidly refused and keep charging interest...should i stop paying the mortage and save a deposit so we can rent somwhere ( they want 6 months rent in advance because of my hubands bankruptcy and my very poor credit rating ) or go bankrupt to clear my other debts (£40,000) and let the courts take the house?...if i went bankrupt could i then stop paying the mortage? or hand the keys back to the bank..and then go bankrupt...cant see any way to keep the home.theres a chance of an inheritence comming my way, could be years off (Least i hope so ) so could lose some of that but surley if i inherit somthing in the meantime any of my creditors could then make me bankrupt.. and get it that way..sorry its a long one and not easy...by the way i earn about 1300 a month and have very little left on an income and expendixture done for us at the CAB ..my husband works seasonal and finds work 5 months of the year...summer and christmas..hes an entertainer and will become unimployed in 4 weeks.
Evem though your husband went bankrupt, if you 'purchased the Beneficial Interest' in the property you are both liable for any shortfall. So both of you would need to go bankrupt. If only you were to go bankrupt, your husband would still be liable for the secured loan/mortgage - therefore both of you would need to file.
My usual advice for people who accept that they are going to lose their home on bankruptcy, is to cease payments on the mortgage/secured loan and use this money to fund your bond and rent on your alternative rented accommodation (often this takes up to 3 months to gteher the necessary funds)Once you have secured your rented accommodation you can go ahead and file for bankruptcy.
You can technically hand the keys back to the OR who will liaise with you and the mortgage company. Whatever you decide to do on this either hand direct back to the mortgage company or the OR DO NOT SIGN ANYTHING provided by the mortgage company ( as they may try to et you to sign a document which will in effect make you liable for any shortfall)
What ever you decide to do make sure you keep your mortgage/secured loan up to date ie inform them that you have ceased payments and are in the process of filing for bankruptcy as this may mean that they will hold off on any action against you both
Melanie Nicholas 29 years insolvency experience - 23 of which in the Insolvency Service - Insolvency Manager Jones Giles email me at email@example.com telephone 01792 899996