I now find that we have negative equity.

[pm.e]

Northern Rock have applied two interim charging orders to our jointly owned property on the benefitial interest of my wife. This is for a total amount of around £50,000.
I am currently in a failing IVA, and I will probably make myself bankrupt as I cannot afford the unrealistic IVA that my IP put me in. (Thats another issue)
The £50k debt was a joint debt, so Northern Rock applied a £50k joint debt on the property because my wife could not afford the this debt repayment.

With my mortgage, secured loan, and charging orders, I now find that we have negative equity.

If I go bankrupt, do the charging orders remain on the property, does the negative equity also remain? as I am hopeful that my wife will be able to purchase my benefiticial interest in the property so that we can all stay at our home?

Any help would be very very gratefully received.

[Storm]

Once made final the charging orders will remain if you go bankrupt.

The debt is joint and several which in essence means you going bankrupt - your wife becomes liable for the full amount.

[pm.e]

My questions are:

1) If I made myself bankrupt, what happens to the two charging orders for the beneficial interest of my wife? I assume as long as she pays the £47 per month no further action will be taken?

2) Would 50% of the two charging orders or all of the £51,000 (whole charge) be considered by the Official Receiver in calculating the valuation of the property?

3) Could my wife buy out my interest in the property for £1 if the values meant that we had a negative equity situation?

4) How could I avoid my current employers finding out about my bankruptcy through the revised NT Tax coding notice I will get from the inland revenue?

5) Should I make myself bankrupt (pay the £480) rather than my incompetent IP?

6) Is there a best time during the month for making yourself Bankrupt?

7) Should I make a complaint to the IP's governing body before or after being bankrupt?

Any advice on all of this mess would be very much appreciated because I have no idea on what to do next.

[MelanieGiles]

Hi there

1) The charging orders remain secured against your property, and you will need to enter into a repayment plan with this creditor. If you decide to sell the property in the future, the charging order debts will have to be discharged before you or your wife receive any monies from the sale.

2) The Official Reciever will get your property valued, deduct the first mortgage and charging order debts and then divide the residual balance in two. His half share will be based upon this figure.

3) Yes - providing the OR is in agreement, and that your wife also pays his costs in effecting the transfer. These should be no more than £300.

4) You can't - but they will not be told that your zero coding relates to a bankruptcy. But putting two and two togeether ...

5) Only you can decide this - does your IP have an obligation to make you bankrupt under the terms and conditions of the arrangement?

6) No

7) On what grounds?

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