Giving the keys back - advice needed

[JNJL]

Hi

 

Long story but after seeking advice on here and from the national debtline we have decided to follow the advice (after a massive internal struggle) we were given to find somewhere to rent, then send the keys back to the mortgage company and then file for bankruptcy.

 

Can anyone give me any advice on how we do this and what happens after we have sent the keys back? Will doing this just blow absolutely any future possibility of ever getting a mortgage again in the future here or abroad?

 

[lic2009]

I'd be interested to hear any advice on this as well.

[gizmo111]

Can anyone give me any advice on how we do this and what happens after we have sent the keys back? Will doing this just blow absolutely any future possibility of ever getting a mortgage again in the future here or abroad?

 

Presumably you haven't been paying the mortgage for a while anyhow so you are in arrears. If your lender has a branch drop the keys in there, if not send them special deleivery. Inform the OR of the house when you declare BR.

Regards getting a mortgage in the future, the BR will be the overiding factor in any lending decision for the next 6 years.

[JNJL]

We are nearly 3 months behind. As soon as we give the keys back to the mortgage company is the house then their responsibility? ie for building/contents ins council tax etc or is it still our responsibility until the day the mortgage company sell it?

[gizmo111]

You need to keep the building insured (or they will and charge you), and inform council tax yo uare no longer there and see what exemptions apply. Any CT bill can be included in the BR if you are paying CT at anothr address.

[s.bridge]

I have just been to court after the mortgage company re-possing my home. After the 28 days were up, I phoned the mortgage company to enquire as to where I should take the keys. They said that they would send out a form to fill in and the completed form should be returned with the keys by registered post. There is a 'repossesion management fee' of £125 added each month until the property is sold privately or at auction.

[JNJL]

Sorry to hear that s.bridge - did you manage to get somewhere to live?

 

We are jumping before we are pushed, our mortgage company haven't started repossession proceedings yet but we are about 3 months behind and with £60000 worth of other debts we just can't afford to keep house so have made the decision to get somewhere to rent before we have no option as can't see us being homed by the council with the housing shortgage!!

[Little Heart]

Hi JNJL.

 

Even if you send your keys back this doesn't mean that it'll no longer be yours.

What i mean is that the mortgage payment plus interest will still be added until the point the property is sold.

 

If you wanted to go bankrupt couldn't that money you're going to be saving help maintain your mortgage payments.

 

Is your mortgage interest only...if not could you write to the MC to possible change you over for 6month or so.

 

Another option is an illegal let.Would you be able to let you house out which then would cover the mortgage payments and a small additional amount to clear the arrears.

 

The only trouble with getting private rented accommadation is that estate agents/letting agencies will do a credit check.If you have alot of missed payments on your file....they may not agree to you letting from them.

 

You've not said if you work or have children etc.If you wanted to fight for your house not all judges are on the MC side.

 

Good Luck with what ever you decide.

[JNJL]

Thanks for the advice little heart. Our mortgage is interest only. The estate agents think we could get about £550 max if we rented house out and our mortgage payments are £968 plus £200 they want towards the arrears. My husbands work has really picked up now and I am working part time just a few hours but not well paid. We have two young children.

 

We did really want to fight for our house but feel like their is no way out all advice seems to be to ditch. The national debtline gave us the advice to send the keys back, still waiting to hear from payplan.

 

We have just been refused a rental as failed credit check due to husbands ccj - even offered to pay a few months up front!!!

 

We are worried what implications are for future if we go bankrupt and keep house, ie when it comes to remortgage and if we then end up losing house then it will be even harder to find somehwere to rent?

[loobyloo35]

Sorry to hear of your woes. I had my house repossessed and I now live in rented accommodation. I didnt hand the keys back, they changed the locks! It was a case of burying my head in the sand which now probably shouldnt have been the best solution.

 

I am assuming having a repo against your credit file stops ANY credit being obtained?

 

Good luck with sorting things out, you are not the only one going through this though I am sure you probably think you are currently.

[tonycee]

You are even less likely to get a mortgage after going BR.

IMO giving the keys back is the last thing you should do.

If they are going to repo anyway, if they wont help, stop paying everybody, and save the money.

 

You could go to court and offer to pay any arrears at an amount you could afford. The arrears could be spread over the remaining term of the Mortgage, and in today's climate, will almost certainly be accepted by the court. If not by the Mortgage CO.

 

What will happen to my home in bankruptcy

[JNJL]

Thanks for the advice,

 

We are going to have to go bankrupt anyway with or without the house. So would your advice be to keep trying to pay the mortgage and go bankrupt rather than give the keys back before it gets to the stage of repossession?

 

I keep going up and down like a yo yo, one minute it seems like a good idea to start again and then i worry about the future? My husband also has his own business will this be affected by bankruptcy?

[JNJL]

Payplan finally phoned me back after a week. Considering they have received a 20 page info pack asking a million and one questions i was surprised by how little they seemed to understand my situation. After working out my income/expenditure they told me i am on a minus of £275 per month before paying any creditors. She then told me to pay my mortgage an extra 50.00 per month to my arrears and come to a new agreement to all my creditors to pay them £1 a month and the CCJ that is now pending £20 per month - call me stupid here but how i meant to do that on a minus of £275 per month?

 

She then told me not to worry this was just a minor glitch and that everything would be alright in a few months when things settled down - we have been going through this for 3 years????

 

Anyone else had a similar experience.

[poppadom dog]

I was repo'ed last year. We fought for many years and IMHO I should have given the keys back or tried to sell a long time ago. We are now renting (had to pay 6months in advance) and for us we have had the most relaxed time in the past 6 months than in the last 6 years. We most likely have shortfall/fees but the MC haven't contacted us at all depsite knowing our new address and us asking to me kept informed every step of the way!

 

I think you have to look at the long-term picture. If you could honestly see life improving and you one managing the mortgage where you are, then fight. If not, get out sooner rather than later.

 

I know so many people who were repo'd or bankrupt in the last recession and they are back on their feet and homeowners again.

 

I ahve spoken to some lender whilst we were battling, who said they would most likely consider us in a couple of years if we can prove our circumstances have changes considerably.

 

Good luck whatever your decision, but as someone who has gone through it the thought of it is worse than the reality, but it does take a lot of strength from the whole family.

[tonycee]

BR is a very personal thing.

 

One size does not fit all.

 

After years of struggling, HMRC made me BR on 19th Nov 2008.

 

I have not stopped smiling since.

 

But thats just me.

[JNJL]

Thanks for that guys it is good to know people who have come out the other side smiling. We have kind of reached that decision especially seeing a friend dying from a brain tumour that life is too short and the stress and worry over some bricks and mortar isn't worth it. It is a difficult internal battle more than anything to just give up and call it a day but i think we are just prolonging the inevitable also a bit of scaredy cat and the thought of facing the judge/mortgage company etc is a bit daunting.

[Goldlady]

One thing you need to know in all of this is that if you go BR before the house is repossessed the shortfall in the mortgage will become a debt which you can be pursued for later. So you need to include the mortgage shortfall in the BR - which as far as I know means you have to wait until the house is repossessed before you can go BR. I know of other people who are desperate for repossession to happen and it just hasn't:-o

[JNJL]

Thanks for the advice goldlady, we are nearly 3 months behind with our mortgage and have been unable to meet the payment plan they have asked for this month and have actually stopped paying the mortage and all creditors on the advice of national debtline - how long are we talking before mortgage company repossess? especially if we send them the keys back will they try and sell the house straight away or would we be better to try and sell it ourselves?

If we did sell it ourselves but don't pay the mortgage in the meantime would we have to sell it for the amount of mortgage plus any arrears - it is an interest only mortgage? All seems quite confusing?

[Goldlady]

I know of a situation where there was a sale agreed on a house and there would have been a shortfall of about 5k which was all charges and so forth. However because there wasn't enough to repay the mortgage with all the associated charges the sale could not go through. The house is still sitting there and the owners have been advised not to go BR because the lender has done nothing about repossessing it.

 

I really don't know how to move forward in this sort of situation. I work for the solicitors who were doing the conveyancing on this one and they don't know what to do either:confused:

[Goldlady]

In fact, thinking about your situation, you might as well stay put for now and pay nobody anything. Find somewhere else to live and move everything that is dear to you there. Other people I know did that and I think they did hand the keys back after they had sorted themselves out. They are still waiting for someone to bankrupt them but hopefully the repossession has now been actioned.

[gizmo111]

When you go BR the property is underthe control of the OR - he needs to know that the shortfall is part of the BR.

The best thing for anyone to do is to stop paying the mortgage etc, do not attend court hearings and use the mortgage money to pay a good deposit and rental up front.

[Goldlady]

Gizmo, can the shortfall be included in the BR even if the amount is unknown at that point in time? That is what has concerned me about the issues I am dealing with and JNJL's situation.

 

If that is the case then I know of three people at least who can move on with their lives:)

[gizmo111]

AFAIK the shortfall can be included even though the amount is not definite.

[Goldlady]

Seems to make sense Gizmo. I will make further enquiries and report back.

[tonycee]

You can owe ten million people.

 

There is only one bankruptcy order.

 

EVERYTHING you owe at the time of the BO order is included.

 

You may owe £250k Mortgage, with costs of £50K, and a shortfall of £100K on the sale price.

 

But at the time of your BO, you owe £250K. Anything after your BO is irrelevant unless you wish to enter an arrangement.

 

In which case you need to act before there is a sale