Hi, I was made bankrupt in August 2007. All un-secured debts have been cleared. I was discharged in 2008 and the Official Receiver still holds the interest in my property. I still and have always paid my mortgage and secured (Picture) loan. My problem is that I took the 2nd loan out in 2004 to try and solve my debt problems - it actrually made things a lot worse. I've struggled with meeting the payments since. I take home 2000 and yet pay out 1600 for the combined loans. My house is currenltly £50,000 in negative equity with approx 213000 owed. If I hand back the keys to Abbey (primary lender) I understand that they will sell the property to regain what's theirs and the shortfall will be picked up by the OR. It's unlikely that Picture will get anything or very little. Is this something that I could use to negotiate out of this Picture loan? I have a family that I don't want to upheave - I've worked my socks off to afford the payments to date but this extra loan that I agreed to in a bad mental state has almost worn me down completely. Hope you can help.
If you hand the property back to the mortgagee any shortfall from either the mortgagee or the secured loan (or both)will be included in the bankruptcy. There is nothing here for you to negotiate.
While you hold the property and make the necessary payments the debts are secured on the property, if the property is surrendered back to the mortgagee the debt to Picture becomes unsecured and into the bankruptcy along with all the other debts you held at the time of the bnkruptcy.
If you do not surrender back the property you will continue to be liable for bothe the mortgge and secured loan payments.
Hope this helps
Melanie Nicholas 28 years insolvency experience - 23 of which in the Insolvency Service - Insolvency Manager Jones Giles email me at melanienicholas@jonesgiles.co.uk
Hi,I was made bankrupt in August 2007.
Posted - 08 December 2009 : 09:42:00
