Hi

I am a home owner who is currently in over my head in debt. I owe about £2,000 in arrears on my mortgage plus arrears from my secured loan about £2,000. I am also falling behind on all my normal bills trying to juggle everything. I have entered into a debt management scheme for the unsecured debt i.e credit cards etc......so unsecured debt isnt an issue.

My partner was the main earner and came out of work in the ressession, he is working again now so we have 2 incomes again. If the arrears were wiped we could get back on track but.....I got a letter today from the mortgage company telling me they were starting proceedings for a possession order. Unless I payed the arrears off in 10 days then its to the courts!!!! I'm sure its just a matter of days before the other secured lender sends the same letter.

The letter stated I can hand the property back to the lender and wouldnt incur court costs etc....Its all getting too much and i feel like handing the keys into my mortgage company and walking away. If I did hand the keys back and the property was sold at auction would I be able to add the shortfall of the secured loan onto the debt mangement scheme? I was planning on letting it go then living in rented for a few years get the business back up and running, get on our feet and buy again? Will I ever br able to get another mortgage or will I be financially ruined?

I dont want to be made bankrupt is this a possibility?

Is there anything else i can do?

I would be grateful for any advice on this matter as i am really getting stressed.....

Many Thanks

Niki

Hi Niki,
I am sorry to hear about your situation and I hope you'll be able to get it sorted.

I'm not sure if this was the first time you've gotten a letter from your mortgage company regarding your arrears etc. but it sounds to me that it might be them trying to get you into entering a Voluntary Repossession. this is basically where you simply hand over your keys without going to court.

Please note that this might not be the best solution as you will still have to pay the mortgage until the house is sold by the mortgage company, and also find a place to live (rent etc.). If the lender sells at a lower price than your mortgage was then you will also be liable for that shortfall.

I notice you want don't want to go bankrupt or jeopardise your future finacial credit so I think should try talking to your mortgage company or selling your house via agent (this might get you a higher price than if your lender sells it).

There is other property solution that I can mention which might help with a minimising your credit and help you move on, so please contact me if you're still unable to get help. (kerri-an@newyork.com)

I hope things work out for you.

Hi Niki,

The mortgage company will have to take you to court AND make a case to the Judge to seek possession, however the judge is there to be fair. Courts are not there to be biased. They are their to be fair. First, of all, are you based in the UK? if so, contact 0845 867 1626 and ask for Paul. There are a number of things that can be done.

If you are outside the UK, type some letters stating to the mortgage company your reasons for the arrears and what you propose to do about them. Be realistic with your proposal. Do not over extend yourself financially and perhaps mention the stress this is causing and the consequences to your life's should they succeed in possession. Post these letters AND fax them - as these are evidence to a potential court that you tried to 'reason' with your mortgage company.

Remember, always pay something each month towards your mortgage as it shows willing and always be reasonable in your communications with the mortgage company and keep correspondence to fax and or letters - as this 'evidence' demonstrates your trying your best and being 'fair'.

Hope this helps.

The situation is little bit serious. Why don't you try to satell the things out of court. You can request to them to give you some more time. Don't go to bankrupt because it is worst. You can talk to any professional for consolidation.

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yes it is a possibility, not to become bankrupt- you do have options it just depends on what on how you approach this - I definitely think you should visit either the citizens advice bureau or go and speak to a debt advisor where they will be able to guide you into the right direction.

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