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BankruptC
Senior Member
1030 Posts |
 Posted - 27 August 2008 : 14:14:47
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I've just been doing some reading on another forum and there is a case on there of someone having been informed by the insolvency service that if a house is repossessed AFTER discharge the shortfall will still be included in the BR! The quote from the IS was that 'there is no time limit' on this as the mortgage was quoted in the creditors section (although obviously not written off as the BR remained in the house until now).
This goes against anything I've read in the past. So does this mean that someone could potentially stay in their house for 20 years after BR, THEN hand back the keys and any shortfall still be included?
What do you experts make of it?
CG. x |
Edited by - BankruptC on 27 August 2008 16:36:05 |
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JulianDonnelly
Junior Member
United Kingdom
325 Posts |
Posted - 27 August 2008 : 14:19:48
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Hi CG,
This is a very grey area. If the mortgage was in arrears and/or reposession commenced during BR, then yes, it can be included and written-off post BR.
Julian Donnelly
Spokesperson for www.Bankruptcyhelp.org.uk
Don't forget the helpline on 0800 078 9367 |
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BankruptC
Senior Member
1030 Posts |
Posted - 27 August 2008 : 14:24:09
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Hi Julian,
That's what I would have thought, but apparently in this case, there are no arrears and no repossession yet. The house was in negative equity at the time though. Maybe this is the reason?
CG. x |
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Needafriend
Junior Member
United Kingdom
344 Posts |
Posted - 27 August 2008 : 14:26:00
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So Julian,
If your not in arrears but know that the equity will be realeased at some stage by the OR then where do you stand.
We know that when the mortgage offer comes to an end next year 31/5 that if the payments go too high that we will have to inform the OR that we cant afford to pay it and then it will go into arrears.
The discharge all being well will be 4/8 but there is a charge ot will be by then by the OR for their bit.
How do we get on, should we look to rent before, stay where we are. We wont be buying the BI as offered to us and we wrote the mortgage amounts in both secured and unsecured on the SOA.
If the OR is aware of the situation from the start and then they know we are unable to afford the house way before discharge should we be able to get this added into the BR before it ends, or because if we stay and we can afford it when the OR says they want us to sell we then manage to sell but for less will we still be liable as then that is down to the OR.
I know i just waffled but does that make any sense.
JO
"There is light at the end of the tunnel, if you cant find it, get a brighter torch!"
You can read my blog here:
http://debtfreejo.blogs.bankruptcyhelp.org.uk/2008/08/24/my-debt-free-future/ |
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soscared
Junior Member
United Kingdom
229 Posts |
Posted - 27 August 2008 : 15:14:27
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| being new to all this and moving into rented accomodation on friday, leaving the mortgaged property and planning to had the keys back in sept, my ex having left the property which is in a joint mortgage then i was on the soa going to put possible mortgage shortfall on the soa, will this if there is a shortfall be written off in the br even if i am discharged from br after 12 months as obviously i dont know how long it will take the b/s to deal with all this |
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JulianDonnelly
Junior Member
United Kingdom
325 Posts |
Posted - 27 August 2008 : 15:19:12
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hi all,
As long as the OR is aware of a possible reposession/shortfall during the BR, it will be written off even if it crystalises after discharge.
Julian Donnelly
Spokesperson for www.Bankruptcyhelp.org.uk
Don't forget the helpline on 0800 078 9367 |
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Needafriend
Junior Member
United Kingdom
344 Posts |
Posted - 27 August 2008 : 15:59:07
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Hi thats ok then,
You had me panicking then julian, as i had written it on the SOA and obviously we dont know what will happen with the house but we know we wont be keeping it as we have to release the equity.
JO
"There is light at the end of the tunnel, if you cant find it, get a brighter torch!"
You can read my blog here:
http://debtfreejo.blogs.bankruptcyhelp.org.uk/2008/08/24/my-debt-free-future/ |
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BankruptC
Senior Member
1030 Posts |
Posted - 27 August 2008 : 16:29:23
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Hi again,
I had this really wrong then. I thought that in order for the shortfall to be captured in the BR I had to write 'possible shortfall' or words to that effect on the SoA. This is why we thought our decision to either keep on the mortgage or not was a 'now or never' type scenario, ie either do it pre BR or not at all. Maybe we wouldn't have been in such a rush to move had we known we could stay in the house, see how it goes, see what the housing market does, THEN if in a few years we were still in negative equity, decide to hand the keys back and the shortfall be written off in the BR.
Or have I totally misunderstood it? If not, it could make a big difference to people going BR at the moment, to know this is an option(unless of course it is common knowledge, just not to me-heehee).
CG. x |
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JulianDonnelly
Junior Member
United Kingdom
325 Posts |
Posted - 27 August 2008 : 17:23:05
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Hi CG,
Property in BR is usually a confusing process. Suffice it to say that you would not have a few years to make a decision (a few months at most).
Julian Donnelly
Spokesperson for www.Bankruptcyhelp.org.uk
Don't forget the helpline on 0800 078 9367 |
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BankruptC
Senior Member
1030 Posts |
Posted - 27 August 2008 : 17:28:15
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OK then. It's all very confusing indeed. This other person must've got it wrong then, although the reply he got from the IS did seem to say clearly there is no time limit.
Very confusing. 
CG. x |
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JulianDonnelly
Junior Member
United Kingdom
325 Posts |
Posted - 27 August 2008 : 17:31:25
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Hi CG,
The issue here is that the IS will quote facts and the law, but won't really go into detail about how it affects your situation or give you anything resembling useful advice. I believe (if this makes you feel better) that you've done the right thing at the right time!
Julian Donnelly
Spokesperson for www.Bankruptcyhelp.org.uk
Don't forget the helpline on 0800 078 9367 |
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BankruptC
Senior Member
1030 Posts |
Posted - 27 August 2008 : 17:40:23
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Thanks Julian,
That does make me feel better. I just couldn't believe it when I read it and wondered if we'd done the wrong thing. This other person does plan to stay in the house for a while and not go for volontary reposession till a while after discharge so it'll be interesting to see how he fairs, though often on forums like this, you don't get the follow-up stories, so perhaps we'll never know.
Thanks again for the reassurance on my situation though-I appreciate that. 
CG. x
Thanks again,
CG. x |
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BankruptC
Senior Member
1030 Posts |
Posted - 28 August 2008 : 13:47:04
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Hi Julian,
I've just been speaking to someone about this again and the email they received from the IS certainly makes interesting reading. As I'm not sure on copyright etc, could I forward the email to you for you to have a look at? Not looking for answers for me personally, as the house situation's now overand done with for us but I just thought you may find it interesting.
CG. x |
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JulianDonnelly
Junior Member
United Kingdom
325 Posts |
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BankruptC
Senior Member
1030 Posts |
Posted - 28 August 2008 : 14:12:15
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Hi Julian,
Email on its way. Let me know what you think.
Maizie: Sent it via hotmail-not surewhy I didn't think of that earlier! Will mail you later!
CG. x |
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JulianDonnelly
Junior Member
United Kingdom
325 Posts |
Posted - 28 August 2008 : 14:24:13
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Hi CG,
A very interesting, if not "political" reply (say lots without saying anything). Property (at the best of times) is a grey area in BR and a lot is down to the discretion of the OR. It is always best to err on the side of caution as you have clearly done in this case. I'll seek further guidance and let you know if anything interesting crops up!
Julian Donnelly
Spokesperson for www.Bankruptcyhelp.org.uk
Don't forget the helpline on 0800 078 9367 |
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What do you make of this?
