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samanthadm
Starting Member
United Kingdom
27 Posts |
 Posted - 04 July 2009 : 11:31:56
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Hallo, my husband and i have a joint mortgage, a joint secured loan and various seperate loan and credit cards. We have been wading in mud for a long time, and are desperate enough to have made the decision to declare ourselves bankrupt. We are scared, and are looking for as much information as possible before we do this. We have good jobs, and two young boys so finding a rental home where we are secure is a priority. Our tentative plan is to stop making any payments, including secured loan and mortgage. Save the available cash to afford the rent on a new property, the deposit and the money for the bankruptcy. We are unsure if we should stay in the house until it is repossessed or find a new rental home asap. We are worried about finding a home after we have a repossession and bankrupcy details on our file. From what i have read, we think we should not declare bankruptcy until the house is repossessed. Is this correct? We are also concerned the OR will clearly question what we have don with the cash we have saved inbetween now and the bankruptsy and demand this as part of our assetts and give view us in a bad light, or as being dishonest. I am frightened of what I have read regarding being given an extended bankruptsy due to it being our fault. We have tried many ways of avoiding this for a few years now, but cannot go on like this, but, the fact we have these debts is obviously our fault. Our mane concern is having a hone for our family, and our hope is to survive this, and move on, with positivity, and a clean slate.
I am also particularly worried about what i say to the creditors and mortgage company when they begin the phonecalls, how do we handle them. I wondered about changing our phone number, but again am worried a judge or OR will view this as dishonesty and mark it against us.
Please excuse this long winded letter, and thank you in advance for your help. |
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gettingoutofdebt
forum expert
2418 Posts |
Posted - 04 July 2009 : 12:24:34
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Hi,
You can declare BR whenever you want and don't need to wait until the house is repossessed. A lot of people declare BR and then voluntarily give up the house for repossession by sending the keys back to the mortgage company.
Stopping paying your creditors is something that almost everyone does before declaring BR as this is the only way that they can afford the fees.
The OR will realise that you need somewhere to live so using any excess for a rental deposit should not be a problem. The only time it will be questioned is if you start splashing out on luxury items for your new accommodation as the OR would expect any excess to be paid to the creditors.
Changing your telephone number is not a problem as this is only stopping the creditors contacting you by telephone and not by letter so they are still able to contact you. Don't forget that you telephone number will be different by the time you declare BR anyway as you would have moved into rented accommodation. All of my creditors had a PAYG mobile number and I just switched it to silent mode so wasn't hassled when they called.
A lot of people who are declaring BR and giving up their house start renting just before they are BR as a lot of rental agencies do credit checks and, once you are BR, it can be difficult getting accommodation from an agency without several (normally 6) month's deposit.
Your creditors will get more aggressive as time goes by. I didn't have a mortgage but for me it was a case of:
Month 1 - a letter from each creditor saying that they had been informed by the bank that the DD had been cancelled. I received a few phone calls towards the end of the month and advised them of my financial difficulties and that I was speaking to an Insolvency Practitioner to review my options.
Month 2 - More phone calls (normally at least once a day for each creditor) and some of my debts were transferred to the debt collection dept of the creditors. By this time I had decided to declare BR so told each creditor this, and the date I was declaring BR, and then never answered their calls.
Month 3 - This is where the creditors get very aggressive. All of my debts were transferred to debt collection agencies and I received a few cards in the post saying that they would be turning up on my doorstep on a particular date although none of them did. I was declared BR early in the 3rd month of non-payment so when each creditor called I advised them of this and gave them the details they needed i.e. case number, OR details, etc. I also sent each creditor a copy of the BR certificate and then never heard from any of my creditors again. |
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samanthadm
Starting Member
United Kingdom
27 Posts |
Posted - 05 July 2009 : 11:17:55
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Thank you for your reply, that is very useful information. If we find somewhere to rent asap, which we are planning to do, is it better to hand our house keys back straight away and begin the bankruptcy process, or allow the house to be repossessed. We have a secured loan and mortgage so i dont know how it would work, or do we just inform both companies of our decision.
We are wondering about rental costs, will the OR only allow us minimal allowance for home rental, or as we will be living somewhere already, will that be agreed.
Thank you again for your help, it is really appreciated
things . . . can only get better |
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gettingoutofdebt
forum expert
2418 Posts |
Posted - 05 July 2009 : 13:54:24
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You can hand the keys back to the mortgage company whenever you like. If you wait a couple of months then it will mean that you will be able to save up for the rental deposit and BR fees. If the mortgage company need to repossess the property it will take them several months and they will need to take you to court. You don't have to attend the hearing but this will cost the mortgage company a lot of time, effort and money so they will be bombarding you with phone calls so most people give the property up voluntarily.
Whether you inform the mortgage/secured loan company is up to you. Once creditors learn that you are declaring BR they realise they won't get their money back and can become aggressive. Some people don't tell their creditors that they are declaring BR due to this.
The OR won't say anything about the rental costs unless they are very high and even then I don't know if they will be able to force you to rent somewhere with a lower cost.
What a lot of people do is find somewhere to rent prior to BR. Declare BR at their current property (i.e. the mortgaged property), a couple of days later they will move into the rented property and send the keys back to the mortgaged company. This will mean that the address you have listed on your BR will be you mortgaged address rather than the rented property so you have 'some' anonymity. If the BR appears in the local paper (this is up to the OR whether they advertise the BR in the local paper or not) then it will also be under your old address. |
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samanthadm
Starting Member
United Kingdom
27 Posts |
Posted - 05 July 2009 : 15:16:46
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thank you
we have just got some details about rental properties in a nearby village. Please excuse my misunderstanding, I am unclear about when it is best to give up the keys. I have read through another persons question regarding the mortgage debt, and if the home is repossessed after the BR it seemed ambiguous, whether or not that debt will be included in the BR order or if a further BR would be needed?
Not paying any creditors at the end of this month would enable enough money for a deposit, and part of a months rent, Septembers pay would be enough to move in, and the much lower rent and non payment of any of our debts would then enable us to afford to give back the keys, then declare the bankruptcy before Christmas. Thus starting the New Year with the worst aspects over and done with ( I think the phonecalls, leaving the family home, the court date and the OR are the things I dread the most,)
I am wondering now about holding fire with finding a rental property until we are ready to go BR. It is quite confusing, and I think I am reading too many forums, with too many different ideas.
I have read that pensions are safe if authorised by HM Customs. My husband has a forces pension, does this mean it will be excluded as income when the OR assesses our repayments?
Thank you again for your help
things . . . can only get better |
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gettingoutofdebt
forum expert
2418 Posts |
Posted - 05 July 2009 : 17:32:17
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Hi,
You can include the mortgage in the BR, just put the details in the 'Secured Creditors' section. Then when you send back the keys you won't be liable for any shortfall. I haven't seen the other post regarding the mortgage not being included in the BR but this could probably only happen if the property wasn't repossessed within the 12 months that the person was BR i.e. they were discharged before the property was repossessed.
There are details about the pension at http://www.insolvency.gov.uk/pdfs/guidanceleafletspdf/pension.pdf
If the Forces pension is authorised by HM Revenue & Customs then it won't form part of the bankruptcy estate and the OR can't claim it. |
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Hallo, my husband and i have a joint mortgage
