Hi I am in a lot of financial trouble I have an intrest only mortgage that I can no longer afford to pay along with a secured loan and the house is now not worth enougth money to pay off both. The secured loan company will not release the deeds for us to sell so have no other option than to hand back the keys. My question is that not only do I have unsecured debt which is currently in debt management along with 3 ccj's 2 of them are joint to the same co but I also have a lot of debt owed to my mother in law. This is because she has been helping us to survive for the past year and took out a loan for us when we moved in as the secured loan company demanded an extra £10k just before contracts were due to be signed. At the time this was managable as our incomes were high but now we have lost our childcare so I have had to reduce my hours to enable me to get the kids to school and my husbands company have removed his 2% bonus bracket making it virtually impossible to hit any commision even thou he is in work all hours. Both the mortgage co and the loan co do not want to help. If we were to go bankrupt would be be able to continue to pay the debt to my mother in law?
We have secured a property to rent and are moving out on the 6th and just sending the keys back to the mortgage co.
I am extremely worried and depressed. Any advice would be very greatfully accepted.
Once you hand the keys back to the 1st charge lender and move into the rental, if you're both planning to petition for bankruptcy then all debts will be written off when you do. Your mother-in-law's debt is, and will remain, hers. You will have to submit income and expenditure figures to the court and the official receiver when you petition for bankruptcy. If you should then have £100 or more per month of disposable income then you will be obliged to enter an Income Payment Agreement. The amount you will have to pay within the agreement will be determined by your level of disposable income.
I'm afraid the OR will not allow payments to your mother-in-law as a legitimate expenditure.
Considering Bankrupcy
Posted - 13 August 2008 : 19:02:01
