I will be filing for bankruptcy in next few days. My wife is as yet undecided, although she has credit card debts which she cannot re-pay.
Our house is being repossessed on 10 Feb and we are moving into rented accommodation.
The questions I have are as follows:
Can any shortfall following repossession be included in the bankruptcy?
What action will the mortgage company (a sub-prime lender) take to recover the shortfall following the forced sale of the property after repossession? (If they pursue my wife for the debt she has no income.)
Is the timing of the br critical (ie before or after repossession)?
you have entered your secured borrowings against the property in section 4 (secured) of your SoA. Make sure you enter the details in section 4 unsecured as well. When it asks for the amount, you don't yet know as the property will need to be repossessed and sold for you to know that so enter your best estimate and write approx next to the figure.Put a question mark or "unknown" for the date.
In the final column headed "what was the debt for" enter "possible shortfall".
This will ensure the eventual shortfall is written off. If you are in negative equity, your property is being repossessed and your wife is a joint mortgagee then she will be liable for her current personal debts plus ALL of the eventual shortfall in the property. Therefore the likelihood is she will be facing inevitable bankruptcy.
If everything is already in place regarding the rental - credit and reference checks done, deposit paid, agreement signed then all is well.
Usually it's best to be in the rental before declaring but if all of the above is already done your bankruptcy should not affect it.
Repossession/Negative Equity/Bankruptcy
Posted - 22 January 2009 : 22:43:49
