My creditors meeting is on Monday 7th September

[danny4]

Forgot to say that we don't want to go into bankruptcy as I don't want to lose the house. Don't know if it would help pay anything off as we have a 40000 negative equity on the house anyway.

[Michael Peoples]

Hi Danny. Sorry to about the IVA but now I think you should seriously consider bankruptcy and if you have no equity you will not lose the house.

You have put forward your best offer and it has been rejected so now you must look after yourself and your family. If N Rock and other creditors get charging orders you will have to make arrangements to repay them and you will never be debtfree or in a positive equity situation. If you petition for bankruptcy the charges cannot be made against your property and eventually you will own it.

I would think twice about a DMP because if you do end up with multiple charges and finally throw in the towel and surrender the property, you will be left in a worse position. You would likely have to go bankrupt at this time and all the monies paid to creditors would have been lost. Speak to Payplan or another IP firm if they will not advise you on bankruptcy.

[danny4]

Advice about a DMP came from the citizens advice bureau as they said that bankruptcy was a last resort.

[danny4]

do the other experts also agree that I should go for bankruptcy and the house will be safe.

[rayb]

Hi,

The House will be safe as long as you keep up with the repayments. The only thing you will need to do if you go down the bankruptcy path is to get a member of your family etc.to purchase the BI (Beneficial Interest) on the property

[Michael Peoples]

Ultimately, you do not own the property as it belongs to the mortgage company until they have been repaid. You own the equity in the property and that is what you would lose in bankruptcy. Given that there is no equity you have nothing to lose and as Ray says a third party can buy your beneficial interest for around £211.

Alternatively, you can sit back and wait and the property will be revalued in about two and a half years. If there is still no equity at this time the property automatically reverts to you. You must however continue to pay your mortgage or the property will be repossessed.

[danny4]

Forgive my ignorance but what is beneficial interest and how does it affect our ownership

[mikepapa]

danny, thats sound advice from Micheal,, give it some very serious thought, good luck in what ever you decide.

[Michael Peoples]

Your beneficial interest is what is remaining after all secured creditors have been paid. The house is only actually yours when the mortgage company has been paid and you have the deeds in your hand.

There currently is no realistic beneficial interest but there will be in the future as the mortgage reduces and the property market recovers. The only people who really care about the property is you and the mortgage company. The official receiver will not be interested as there is nothing in the house that can be realised for the benefit of unsecured creditors.

[MRBLUESKY]

danny if i was you i would get in touch with michael and ask him if he could help you.10 days is a long time to wait mate you need action now.

[danny4]

Michael would it be possible for me to ring you tomorrow for advice and get everything moving

[MelanieGiles]

I am concerned that you are being told that your NR loan will become secured if you enter into a DMP, as if that is a definite thing. Yes, NR can apply for a charging order - but so can every other creditor, so please don't think this is a done deal.

I suspect that your case has not met the well known NR criteria for IVAs, and perhaps it should never have been put forward in the first place. I am sure Michael will be more than happy to discuss this with you if you need advice which your own firm do not appear to be able to give.

[danny4]

Thanks Melanie. Obviously from all the feedback you get you are very well respected and I have found this site really helpful. Would you agree with Michael's advice so far not that I doubt what he is saying but always good to have more than one opinion. I guess what I am concerned about is my house. I really don't want to lose it and I have tried to pay something but obviously it wasn't to be.

[MelanieGiles]

Michael has given good advice with regard to the bankruptcy option - but I would not hurry to tell you that is what you ought to now do. That must be your decision at the end of the day, and the last thing that NR will want you to do as this will result in them receiving much less than the IVA was offering or they might get in a DMP.

But at the end of the day, you must make the right decision for your future, and if you feel that they have not been helpful in accepting the IVA, then you need to decide whether a short-term solution versus a long-term repayment plan is the best way. It is very difficult for either Michael or I to advise you without full knowledge of your case - and at the end of the day your own IP should be doing this!

What equity is there in the house at present?

[danny4]

I have no equity. My house has a negative equity of approx 40000.