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SPT
Starting Member
United Kingdom
38 Posts |
 Posted - 25 September 2008 : 13:22:33
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Hello all
I am two months into and IVA with payplan, my wife has just started a DMP. We have recently found out we are expecting our third (and final!) baby due next April. Bad news is our mortgage introductory term has just expired and the payments are increasing to £840 a month from November. Ultimatley we have no chance of maintaining the IVA and DMP from next spring (if not sooner) so are now considering BR.
In setting up the IVA we found we were just entering negative equity (due to 2nd charge) so do we
a) start missing mortgage,secured loan payments,debt payments and find somewhere to rent prior to going BR.
b) Go BR now and try to hang onto property (currently up to date with payments).
I haven't spoken to payplan yet but don't know what our next move should be.
Please help!!
Steve
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John
New Member
United Kingdom
73 Posts |
Posted - 25 September 2008 : 13:37:40
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Hi Steve
your wife can stop her DMP anytime as it is an informal arrangement. You however must miss 3 monthly payments into your IVA before it fails. Until it fails you are not likely to receive a Certificate of Termination from your IP which you must have to declare bankruptcy.
To avoid hassle from creditors. Deal with your situation first. Tell your IP of the situation and that there seems no point in continuing as BR seems inevitable once your wife stops working. You may get lucky and have an understanding IP but you need that Certificate.
Until the Certificate is issued your creditors will leave you alone.
Stop paying your mortgage and any other secured loans now. Stopping these payments should give you enough money for deposit and rent in advance later which you should sort out, and be in the new property, preferably just before the 3 months is up as a credit check will be carried out and you don't want BR on the check.Again you need to miss 3 months payments before the lender can commence repossession.
To avoid hassle from your wife's creditors continue with the DMP until just before you both declare BR.
www.Bankruptcyhelp.org.uk
0800 078 9367 |
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John
New Member
United Kingdom
73 Posts |
Posted - 25 September 2008 : 13:40:46
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Hi
just read your post again, if the savings from the non payment of IVA and DMP come next April means that you would comfortably then afford the mortgage and you wish to do so, as it is in negative equity the cost to you both in BR to keep the property would be circa £212 to the OR.
www.Bankruptcyhelp.org.uk
0800 078 9367 |
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SPT
Starting Member
United Kingdom
38 Posts |
Posted - 25 September 2008 : 13:56:36
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Thanks for the info RE IVA didn't know I needed a certificate. But if/when the IVA fails will my creditors apply to make me bankrupt or will I do that myself?
We are not that concerned about losing the house. And paying £840 a month interest only on a property in Negative equity doesn't thrill me either just thinking longer term with repossesion,BR etc we would be renting forever? |
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got there
Junior Member
United Kingdom
461 Posts |
Posted - 25 September 2008 : 14:30:44
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Hi
I am with Payplan (was) i started my IVA in April and missed 1 payment in Aug, me and hubby decided to split up end of August, so IVA was doomed. I spoke to my case officer at Payplan who has been fantastic from the outset - i have missed 2 payments to date, but recd a IVA failure letter from her this week ready to show at court if needed, she told me when I rang initially that you dont have to wait for 3 months of missed payments if its obviously not going to work for you, then they can fail it for you if you have decided to take the BR route. HTH x |
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SPT
Starting Member
United Kingdom
38 Posts |
Posted - 25 September 2008 : 15:53:42
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Thank you for your help.
We are going down the BR route, but are unsure whether to struggle on with mortgage (hoping interest rates drop) or walk away now and then take the plunge. |
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John
New Member
United Kingdom
73 Posts |
Posted - 25 September 2008 : 16:15:53
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Hi
I don't want to infuence you re the property as the choice has to be yours.
But just so that you know, if the market doesn't improve, or things get worse, and interest rates rise (I'm old enough to remember paying 16% interest in the 80's / 90's) and you have struggled to pay the mortgage, if you much later down the line find it impossible then the shortfall between your mortgage and the auction sale price will become unsecured and you may be looking at bankruptcy all over again.
www.Bankruptcyhelp.org.uk
0800 078 9367 |
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SPT
Starting Member
United Kingdom
38 Posts |
Posted - 25 September 2008 : 19:41:21
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Thought about that, but the things puttng us off renting are Credit checks and unlikely we would get on the ladder one day in the future?
Still more mulling over to do, I think I will break the news to my IP in the morning!
Thanks all
Steve |
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got there
Junior Member
United Kingdom
461 Posts |
Posted - 25 September 2008 : 20:01:43
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Hi Steve
As regards renting if you have a relative who is willing to stand as a guarantor you should be okay with renting just be up front with them, and save the deposit etc by not paying the mortgage. If you want to you will be able to get back on the ladder. Your credit file would be clear of the BR after 6 years, it would be like you had never had any credit etc.
There is no point in struggling its bricks and mortar at the end of the day. Home is where you and your family are whether you are renting or whether the mortgage company owes your house.
Good luck with whatever you decide. |
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SPT
Starting Member
United Kingdom
38 Posts |
Posted - 07 October 2008 : 11:10:30
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Me again
More questions please help!
Latest plan is to stop paying mortgage etc and declare BR early next year when settled in rental house elsewhere. Next question how does the attachment of earnings work? Is it taken at source and what is the No tax code I have read about,is that the same thing?? Also with OH being on Mat Leave from next April is the attachment flexible? as her pay will decrease as the months go by. Can / will that be taken into consideration??
Any advice / Info most appreciated. Thanks all
Steve |
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Skippy
forum expert
United Kingdom
3290 Posts |
Posted - 07 October 2008 : 12:18:53
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If you have more than £100 surplus income you will receive an Income Payment Agreement (IPA) or Income Payment Order (IPO). This is for a percentage of your surplus - there is a table in my blog showing what you would be expected to pay. The money is paid over each month to a firm of solictors acting on behalf of the OR. I pay mine by standing order on the 30th of each month.
For the remainder of the tax year when you are made BR you will be put on an Nil Tax Code. This means that you will receive the tax you should have paid. This must then be paid over to the OR. If you are going BR at the beginning of next year there is a chance you might not get an NT code - it depends how quickly HMRC set it up.
If your OH is on maternity leave (congratulations BTW!) you can ask for the IPA to be varied. You would need to contact the OR and ask them to send you a new I & E form and they will reassess the IPA.
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/ |
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got there
Junior Member
United Kingdom
461 Posts |
Posted - 07 October 2008 : 12:52:02
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Sorry to jump in on this, But skippy i dont earn enough to pay tax until maybe March it at all, will they still ask for a NT code for this tax year??
Ta in advance x |
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SPT
Starting Member
United Kingdom
38 Posts |
Posted - 07 October 2008 : 13:11:17
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So does the OR sort my tax code or do I need to advise work/tax office myself?
Ta lots
Steve |
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Skippy
forum expert
United Kingdom
3290 Posts |
Posted - 07 October 2008 : 13:11:21
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I doubt it - I went BR on March 29th and didn't get an NT code as there wasn't enough time.
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/ |
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JulianDonnelly
Junior Member
United Kingdom
325 Posts |
Posted - 07 October 2008 : 13:51:07
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Hi SPT,
The OR will contact your tax office to make the necessary arrangements. You don't need to do anything.
Julian Donnelly
Spokesperson for www.Bankruptcyhelp.org.uk
Don't forget the helpline on 0800 078 9367 |
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SPT
Starting Member
United Kingdom
38 Posts |
Posted - 07 October 2008 : 13:58:56
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Thank you all, What a massive help this site is!
Steve |
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Now what??
