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hopeful77
Starting Member
9 Posts |
 Posted - 21 November 2011 : 14:52:24
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Confused? My wife and I are looking at Bankruptcy as an option and we have delved pretty deep into the pro's/cons of the action. However we are stuck with the following: Unsecured debt aside, our house is in negative equity and we want to included this is the bankruptcy. After reading the forums we can see that this can happen, but our issue is this. Should we had the keys back on day one, try (if we can (more on that later in the question)) to rent either through an agent or private on day 2 and then file for Bankruptcy on day 3?
Our logic is this. If we hand the keys back we are opting for voluntary possession, we then stop paying the mortgage (1 to force the repossession order and 2 to pay for new rent) then apply for a rented property before filing for bankruptcy due to the letting agents getting references.
Assuming we are OK with charges and costs associated with the mortgage arrears, can this work? Its not that we are trying to trick the system, we just want a path of what order to do things. Any help will be greatly received. |
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Viki.W
forum expert
United Kingdom
2211 Posts |
Posted - 21 November 2011 : 14:56:43
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Hi hopeful77,
Yes, you are right, that is what you should do.
Stop paying your secured debts, get into rented and then file for bankruptcy.
Make sure you speak to an expert for advice to make sure bankruptcy is your best option.
Viki Warbrooke
Vincent Bond & Co
If you would like free advice on all options available and help with your bankruptcy petition please contact me at http://www.vincentbond.com/about_us_Viki_Warbrooke.asp
Please read my experience of debt via my blog at http://vikiw.blogs.iva.co.uk/ |
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hopeful77
Starting Member
9 Posts |
Posted - 21 November 2011 : 15:12:14
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@Viki.W
Thanks for your quick response, however any other hints and tips would be welcomed, such as how would the courts view this? as in purposely making yourself repossessed just so you can include the negative equity debt etc.
Also would you give any pointers to the time-scales of the events listed?
Thanks again.
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Daniel Griffiths
Junior Member
United Kingdom
268 Posts |
Posted - 21 November 2011 : 15:33:13
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Hi Hopefull
The property negative equity will be included in the bankruptcy at any time after you petition, ie if you petition on the 1st December 2011 and continue living at the property till say Easter next year, because you may think with the unsecured gone the home may be affordable but then realise it is not, and then stop paying the mortgage when its eventually repossessed and sold say in another year 2013, then the shorfall will still fall into the original bankruptcy debt because your mortgage was taken out pre December 1st 2011, unless of course you sign a deed of arrangement with the lender post bankruptcy. I get the idea you think you have to be out of your home into rented when you petition to which you do not. |
Edited by - Daniel Griffiths on 21 November 2011 15:37:12 |
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hopeful77
Starting Member
9 Posts |
Posted - 21 November 2011 : 15:41:59
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@Daniel Griffiths,
Thanks for the response. Any advice is warmly welcomed.
The only reason I mentioned moving out before the bankruptcy is to help secure a rented property.
I'm sure (please correct my if I'm wrong)that if I apply for bankruptcy, then vol' repossession, then look to rent a property then the letting agents will probably be still laughing as I'm going back out the door, tail firmly between my legs.
However like I said, any advice would be great as I want to make sure I'm doing it the right way for a change(A bit late for that, me thinks!)
Hopeful77 |
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Daniel Griffiths
Junior Member
United Kingdom
268 Posts |
Posted - 21 November 2011 : 15:50:35
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| I would never advise the letting agent route, many bankrupts can rent property following bankruptcy by simply placing a wanted advert in a local paper and Landlords will contact you direct,they dont all like letting agencies, when you find an affordable property sit down with the landlord tell him of your past and tell him he is getting a debt free tenant who will look after his property as your own, however remember the renting route is not secure, you get six month tenancy, landlords can go bust, are you absoloutely sure your home is not affordable following bankruptcy and release from unsecured debt |
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hopeful77
Starting Member
9 Posts |
Posted - 21 November 2011 : 16:01:45
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@Daniel Griffiths,
Thanks again for your response.
Is there any reason to steer clear of letting agents? is it the references, inflated rental PCM's or anything else. For my sins (of which there are many!) I was an Estate Agent in a previous life, so I do have a rough albeit hazy memory of lettings and AST's
In answer to your last question, our mortgage has just increased after our rate ended and we re-mortgaged (via existing lender) on to the cheapest possible rate. Even with the unsecured part gone we would still be in a deficit, however looking at rental prices in our area, we would be back in a positive if we lost the mortgage and moved into renting, hence my first post.
Thanks again, and I fully understand if you no longer wish to reply bearing in mind I used to be an Estate Agent! LOL!
Hopeful77 |
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Daniel Griffiths
Junior Member
United Kingdom
268 Posts |
Posted - 21 November 2011 : 16:51:07
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| The only reason to steer clear of letting agents is that you will not pass the credit check post bankruptcy, dont know about pre bankruptcy, I have nothing against letting agents my daughter is one, but any bankrupt looking to rent property will not as you have already mentioned have letting agents falling over themselves to rent you a property. |
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hopeful77
Starting Member
9 Posts |
Posted - 21 November 2011 : 16:55:30
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@Daniel Griffiths,
Thanks again, your input has been great.
To be fair this site has too, thanks again all.
Hopeful77 |
Edited by - hopeful77 on 21 November 2011 16:55:48 |
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Richard P
Senior Member
United Kingdom
1701 Posts |
Posted - 21 November 2011 : 17:28:34
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find local small estate agents they tend to have the ability to be more flexible
or as stated above an entry in small adds or lok for private rentals
Good Luck Richard,
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Confused? My wife and I are looking at Bankruptcy
