www.iva.co.uk

Firstly, hello again! I haven't been on for a good while (since I had a bit of an emotionally bad spell and bit "Optimists" head off about one of his posts (so first thing to say is sorry to Optimist! [:)])

Things are going well now for us both - i'll be updating our blog soon, but it turns out that one of my close family members is in financial trouble too.

He is considering bankruptcy, the only sticking point is that he doesn't want to lose his house (he's been paying for it and living in it for 25 years).

At the moment it is in negative equity - at the moment it is worth approx £370,000 (could be less though) and mortgage is £400,000. (It was mortgaged to the max a couple of years ago due to a divorce settlement).

The mortgage payment interest only is £1,800 (although probably down to £1,630 thanks to yesterdays rate cut), but my question is, given the current downturn in prices, will the OR let him keep the house as long as it remains in -ve equity (subject to costs) and is £1,800 mortgage payment deemed "excessive" or could the OR force the sale regardless? Family member is 60, but there seems no other way out of the debt, and it would break his heart to lose his family home now [:(]

Hi Wen, and welcome back!

I'll bump this one back up so that Melanie or Andy will see it.
I think if it is in negative equity, he may be allowed to keep it, but I'm not sure.

The other thing is that Optimist is long gone! I think he upset one to many people and was locked out.

Hi
The sticking point will be the high housing cost each month.It could be argued that the money paid for the mortgage could go to the creditors instead by way of a monthly IPA.
Wait for Melanie's or David's answer on this
Regards

The other thing I meant to mention, was there is a possibility of renting 2 rooms out at a possible total rent of £600 a month which would obviously reduce the mortgage to £1200 too, but i'd be interested in the experts opinion on the £1800 payment.

Also he is married and long-term his wife will contribute, but she is still paying out the mortgage on her property but is trying to sell.

I can't give you any advice, but I wanted to say welcome back! It's spooky, the other day I was wondering how you were getting on!

The OR will not be bothered by the level of mortgage payment, so long as your relative can continue to afford it. As there is no equity in the property, a simple transaction by a family member to acquire the beneficial interest for the nominal sum of £1 plus legal costs will probably be the last he/she hears of the matter.

Thanks Melanie, that will put his mind at rest.

Is it likely that the OR would wait the 3 years before allowing the transfer of the beneficial interest back, so to allow for the housing market to recover?

No - they will want it off their desks as fast as a ferret down a rabbit hole!

LOL, I am sure my two Jack-Russells would be down a rabbit hole even quicker!

Thanks again.

Did you see the programme with Martin Clunes the other week about dogs, which showed footage of three Jack Russells catching rats? Incredible, they are so good at it. Could do with some round my place as we live in the country. Send them both over for the day!

My mum wanted a Jack Russell, but somehow ended up with Blaze, her nutty rottweiler cross labrador! Probably something smaller would have been better for my mum!

Yes we did!! That was a really good programme, although Maverick (our youngest) is a complete mummy's boy and would just bark at a rat, roll over and wait for his tummy to be rubbed, whereas Becks would have their necks broken in a flash!

Hi again Skippy! We are well thank you, hope you are enjoying 'Discharged'-life!!

A rottweiler-labrador sounds like an interesting combination!! lol

Glad you're ok. I'm enjoying life as a discharged bankrupt thanks!

Yes, you could say Blaze is interesting. She's the softest, nicest natured dog I've ever met, but she's really boisterous and has pulled my mum over a few times. She wouldn't be without her though.

You should take her running with you Skip! She'd be sure to frighten of any attackers on the tow-path!