confused???

[jane.l]

Just spoke to Picture Finance, I thought they were ringing me with information regarding "lifting" the second charge on our house and allowing a sale, but she was ringing to get a payment out of us. I asked how likely is it be approved and the sale go ahead, bankruptcy was mentioned and the fact that if it came to that, they would be getting next to nothing, and the lady told me that mortgages and secured loans are not included in a bankcrupcty and still have to be paid and bankcrupty is to enable to you to continue paying your mortgage and secured loan???????????????? NOW I am REALLY confused, I did not think that this was the case. I was considering bankcruptcy as a last resort,, does this mean we would still be liable for a mortgage and secured loan??? We had a bit of a heated exchange as I do not feel that this is correct, but of course, she is the expert and knows better! (quote)

[MelanieGiles]

Jane

If you were to go bankrupt, and the house was sold leaving Picture with an unsecured shortfall, that debt would be included in the bankruptcy and you would not be required to deal with them again.


Regards, Melanie Giles, Insolvency Practitioner for over 20 years.

For further details contact me at http://www.melaniegiles.com and view my IVA blog at: http://melaniegiles.blogs.iva.co.uk

[go_4_broke]

Hi Jane,

Yes I'm afraid you will.

The mortgage and secured loan are not affected by bankruptcy. Remember the other post on this subject today?

However as you are not living in your house any more (I think ?) there isn't any benefit to be gained by paying either the loan or the mortgage. If Picture won't let you sell, and you can't raise the £10,000 to buy them off, your best best might be to go into voluntary possession with the main lender. They should have less of a problem with this as they will get most if not all their money back, and it is Picture who will suffer because they have 2nd Charge. They will only get any 'leftovers'. This might actually be a good lever to use on them because at least if the sale goes through they may get something? Worth doing the sums perhaps.

Once you can get shot of the property then as Melanie says any outstanding debt can go into the bankruptcy.

Your main problem is timing, becuase you need the unsecured loan to crystallise BEFORE, or at least during, your bankruptcy. You don't want to have to do it twice !

-Best

Please view my blog at www.go4broke.blogs.iva.co.uk

'6 years sticking my head into the Lion's mouth of debt !'

[jamesfalla]

Jane

I have worked with a number of people who have been through a similar situation as yourself. If there is little or no eqiuity in your house and you have other unsecurred debts hanging over you, as go_4_broke says, a final solution would be to hand the keys back. The mortgage lender will reposes the property and force sell it. They may get their money back, but any debt left over (ie the secured loan) would then turn into an unsecurred debt.

I know the thought of letting your house go is very difficult. However, after doing this, all your remaining debt would be unsecured and therefore written off through the bankruptcy procedure. You could then start afresh once and for all.

James Falla

Expert in IVA, Bankruptcy and informal Debt Management solutions for over 10 years.

For more information visit www.jamesfalla.com and visit my blog at: http://jamesfalla.blogs.iva.co.uk

[neverending]

Jane
Just to add that you have probably done the hardest thing and that is to move to another property and leave your house behind.I would suggest taking the advice thats been given so that you can start your life again.You have tried to sort your problems out but if picture finance are not going to budge then you may as well hand the keys back and let the mortgage lender and Picture fight it out between them.
regards

[jane.l]

thanks for that info, so for example: Picture Finance will not remove the charge, so peventing a sale, and I then tried to petition for bankruptcy, what would happen? my thinking would be that the OR would take over the house, sell it, pay off N Rock their secured part and then there would be some for Picture? we would have some unsecured portion of N Rock loan and the shortfall from Picture as well as our other unsecured debts. Is this not correct in bankruptcy? I think I have been worryingly wrong in my ideas!!

[scaredkez]

jane once you go BR the oR takes over your assets they become his, any secured or unsecured lenders are all notified of your BR, once they have sold your assets and the mortgage co paid their amount anything left will be distributed to your creditors the secured ones get priority first, if there is not enough to pay your debt that is tough on them they can only get what the OR has received, as long as you have put everything on your petition they cannot come back to you for the shortfall, i have heards some try but you refer everything back to the OR and they deal with it, its just away to frighten you as they know once you are BR , you owe them nothing, some companies will even say they don't do BR this is a load of tosh, its not an easy way out but it is a way for your to rid yourself of all debts and start a fresh, take no notice of picture and do what you feel best. what you will find probably the house wil be forced sold for a lot less than what is owing and picture will know this and realise they won't get anything they are trying to frighten you into staying they don;t know you are already moving so once it is handed over to the oR its not your problem anymore.
kerri

Please view my blog at: http://scaredkez.blogs.iva.co.uk/

[jane.l]

in Go4Broke's post, you said " don't want to do it twice" and timing matters, why is this? Is that what the woman from Picture meant, she said bankruptcy does not cover secured debts, but if I was bankrupt, the OR would sell the house anyway so the Picture debt would become unsecure? I have made such a ballsup of my life so far, I just want to do the right thing from now on, and not make things worse, thats if they could possibly be ANY worse! haha

and top it all off, when I got home last night, I had a letter from Capital One (I applied for the secured loan from them and they put me in touch with Picture originally) and the letter was offering me the chance to apply for a loan of £100,000!!!!!!!!! I had to laugh!!

[scaredkez]

the woman from picture is trying to frighten you, what she probably means that if you wished to keep your home after BR and this was possible and you were making the mortgage payments then the secured element of pictures would still be there, but as this is not what you are doing you are giving the keys back so therefore the property becomes the OR's, i think this is what go4broke means also, picture as he rightly says will only get the left overs once the mortgage co has been paid, i think the woman from picture is hoping that you are trying to do everything to keep the roof over your head from being sold, we have all made mistakes and that is why we are here but don't beat yourself up about it now, you have tried your best.
when i petition for BR i will lose my house i don't have any secured charges on it although one has threatened it but will take a few months to do as they have to ccj me first and me not pay it, i wouldn;t have known that had it not been for the different forums i read and would have panicked.
capital one offerring a 100k loan is very funny ask them if it could be unsecured to get picture off your back lol, only joking.
i hope everthing starts to look a little clearer for you soon, have you tried the CAB also for information, its free at least!
kerri

Please view my blog at: http://scaredkez.blogs.iva.co.uk/

[jane.l]

I tried the CAB, and they were not very helpful as the situation is complex. They suggested that I had been mis-sold an IVA as I did not need one and that I should report the IVA company!!!! I don't think they really grasped the severity of the situation, I have a 120% mortgage, house is worth just enough to cover this, and I have a £35000 secured loan,(over 25 years) a £20000 unsecured loan,(over 25 years, although I took out £20000, they say I owe £30000, is this interest?????) a £6500 credit card bill and 2 cars on hp, and 2 catalogues, about £800 each! monthly income joint is about £2444 and outgoings are far in excess of this, and we have had to use the credit card for shopping, etc, all I can see is a prison sentence of 25 years of debt hanging around my neck, I'll be an OAP if I ever managed to pay it all off! I might try a CAB in another town? I just do not know where to go for some proper impartial advice

[scaredkez]

been there with the credit cards for the weekly shop.
maybe a good idea to try a different CAB, mine has a dedicated debt specialist, although some of his info wasn;t upto date i am grateful they will check the BR forms free of charge for me as a lot of debt specialist charge for this.
i think BR sounds the best way forward i know it is seems frightening but at least like you say you wont have the prison sentence of debt, i truly hope you can find a way out of this nightmare soon, once my iva was rejected i set up a dmp and the reality is i would probably be dead before it is ever paid off, i have tried every avenue and BR is the only route open now, after 8 months of all this i cant wait to get it over and done with. i complained about my IP also which is in the hands of the regulatory body at the moment so it may be worth your while asking them to look at your case you have nothing to lose by that at least
take care

Please view my blog at: http://scaredkez.blogs.iva.co.uk/

[Hunter1]

Jane,

I really think BR is the best hing for you in this situation.

You have tried your very best to sort this out and seem to be getting more and more stressed out about it.

BR is not as frightening as it sounds - there are lots of people on this site who have done it or are considering it and can help you through it.

I lost my house because of my debts. It was an incredibly hard thing to do but it's a pile of bricks in the end and the important things are your health and your family and you'll still have those.

Don't go through this alone - we are all here for you.

[MelanieGiles]

Jane

Can I suggest that you pick up the Yellow Pages and find yourself a local insolvency practitioner who is prepared to give you half an hour's free consultation on a face to face basis.

You have been given much advice from a number of sources - some good and some well-meaning. I feel that you are still very confused about the nature of the Picture secured loan, and what will happen to that in the event that your house is sold. They will also be able to explain to you what happens in bankruptcy, and you can then ask as many questions as you like with regard to your situation in order to make the right choice for you future.

Regards, Melanie Giles, Insolvency Practitioner for over 20 years.

For further details contact me at http://www.melaniegiles.com and view my IVA blog at: http://melaniegiles.blogs.iva.co.uk

[jane.l]

bankruptcy is sooo scary, I have accepted we have lost our house, but I do worry about renting if bankrupt, also we want to go on the council housing list so just handing the keys to our house back is not an option. I have got a rented house for 6 months and we are moving there next week, but it is quite expensive as it is a new build and council tax and water meter bills will be high so I am just seeing it as a short-term thing. Not sure if where we would stand as to a council house but no harm in applying! I would probably lose my car too, and have to get a cheaper one, but maybe in years to come, I could get another nice car?

Another worry is my husband's job, he is a manager in his company, in charge of the engineers, he has been there 20 years, he mentioned this as he was reading about bankruptcy and it says you cannot be a director or manager? would this apply to him? I have told him to read his contract thoroughly. I don't think it would affect my job

[jane.l]

yes, thanks, Melanie, good idea, I think that I will try and do that, or go to CAB again in another town, just need someone in the know to point us in the best direction!!