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[Casa02]

Hi there,

I really need some advice from one of the experts re my situation.

Two years ago, one of our rental properties was taken into ‘administration’ by CHL. What this means is that they control the keys, they get the rent, but we’re still responsible for the mortgage and all other bills including council tax. Kind of like repossession on the cheap if you like!

Last October we declared bankruptcy, and have been lucky to be given early discharge. So a new start, and a long haul to rebuild the credit record.

However, the one issue we have is that the flat that was taken into administration, has not yet been sold by CHL, although their have been 5 sales agreed which subsequently fell thru. EACH MONTH THEY UPDATE OUR CREDIT RECORD WITH A NON PAYMENT, AND THERE SEEMS TO BE NO END.

I did approach them to ask them to repossess, but they got back and said that we should appreciate that they will be shouldering a big loss, and therefore didn’t want to go to the expense of the repossession. From my experience, once a property is repossessed the credit record then goes to default, with no further entries after that, other than settled when sold.
Clearly from our wanting to build a new credit record WE ARE QUITE DESPERATE for the monthly arrears status to stop happening.

So finally, the big question. Is there something in the bankruptcy laws which means that all defaults should not be dated after the bankruptcy for assets included in the bankrupt estate? Anybody been in this situation before and dealt with it successfully? Any advice?

Looking forward to your responses.
Cheers,Casa

[Thomas]

Hi Casa

Wasnt this property dealt with as part of your bankruptcy?
Sounds a bit unusual so why dont you speak to the OR who dealt with your case or phone Myvesta asap.

[Hg]

Hello

This is an interesting and new twist on an old problem. I can't think of a solution. What they are doing makes sense to them, but it causes an awful problem for you and means bankruptcy isn't giving the the fresh start it is supposed to.

The Official Receiver will do nothing as there clearly isn't any equity in the property for him to get his hands on. It isn't included in your bankruptcy as it is a secured debt, and I imagine there is no financial benefit to them in being able to claim in your bankruptcy for the shortfall, so they wont repossess so they can.

The accepted way of making a mortgagee do something is to stop paying the mortgage. But if they refuse to bite, you can't make them.

I'm stumped.

In the long run, if the mortgage refuses to enforce their security while you're not paying for the house, they may lose the right to and the house would become yours. But that would be a very long time down the line, and they might argue that the circumstances are different from someone living in a residential property mortgage free; they are receiving some money.

I think this is something the legislation hasn't considered, and that may need given publicity so the law is changed.

I think the only thing that could sort out your situation in the short run would be a surprisingly big upturn in the housing market that made it worthwhile for them to take possession and sell the property. But there's none in sight at the moment; even with recent small falls property is still stupidly overpriced compared to people's earnings.

[Thomas]

Casa
glad to see that HG has given you some helpful advice but if your property has a current tenant why are YOU paying that person's council tax and other bills?

[Thomas]

My own experience showed me that if a property is unoccupied and empty there is a council tax class known as "Long Term Empty" (up to 6 months) which should also exempt you from payment for any period when your property is without a tenant. In my own case this was followed by another class called "Mortgagee in Possession".

[Hg]

Sadly the mortgagee isn't in possession here. I'm sure the poster wishes they were It's a nasty trick that's being played here.

[Hg]

Been thinking about this long and hard.

I can't see a way out the council tax, but there is no reason for you to be paying the utilities. I mean, do you care if they get cut off? If that were to happen, it might even force their hand to repossess!

I'm not sure if they can actually carry on updating your credit record, and they probably aren't too sure either. I think it would be worth confidently telling them that they shouldn't be and seeing if they stop.

[Casa02]

Thanks all for your advice!

Actually it's quite spooky because a couple of days after I posted this, the account was updated as settled at the CRA's despite not being repossessed. It's almost as though they had a spy reading my post! Alternatively it may have been in response to my previous letter to them making a formal complaint. At the time they refused to do anything about it, but several weeks later it was settled. Perhaps somebody else got to review the case. I guess we'll never know, but boy am I relieved!!!!

Cheers,
Casa

[stevejohnson]

Its very difficult to live after we face the problem of bankruptcy. I can understand your feelings. You have to clear all the debts and you should be a good tax payee. Bankruptcy is legally declared inability or impairment of ability of an individual or organizations to pay their creditors.
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steve
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