Hi gillianr2.

I think the best starting point for discussing this will be with your husbands Trustee. They may have a view on the creation of this this shortfall debt which will have an effect on the dividend that will be paid to other creditors.

Assuming the Trustee is OK with this there is little that NRAM can do, the shortfall debt will become another trust deed creditor.

There have been a number of questions on the forum in the past in connection to renting a home with a damaged credit rating. Overall it seems to be an issue that can be overcome; in all of the years that the forum has operated I cannot remember a visitor not being able to rent privately. Being upfront and honest with agents and/or landlords seems to be the best starting point so that the credit report (if they do one) doesn't come as a shock. It's also worth pointing out that a trust deed budget specifically prioritises the payment of rent and other housing costs.

Hi Gillianr2

i agree with TDA - if your Trustee is ok with it, then NRAM cannot stop the shortfall being included in your husband's Trust Deed, as long as it is repossessed. However, NRAM could be difficult and not agree to accepting an offer which is less than the outstanding mortage. If you are unhappy with where you live, (and it sounds like it would be years before you could sell and and cover the mortage) renting would be a good option, and bankruptcy does not normally cause a problem. If you leave this too late i.e. and your husband is discharged from his TD, it will be too late to have it included as a debt & you will be liable for the shortfall, so you need to make the decision sooner rather than later. Speak to your Trustee, who will advise you of the options.

Thanks so much to you both for the replies. Nram have already said they would accept around £80k for it BUT we would need to give them the shortfall or at least arrnge to pay them back the shortfall, this is when my husband told her of the trust deed and she said they would not accept the money going in the td, we would need to pay it back. My husband explained that we couldn't legally do that as he is in a td but she said they wouldn't accept that. Does that mean once they accept that the money will have to go in the td that they just wont accept any offers on the house and will force us to go down the repossesion route? We really dont want to have to do that as we live in a village and the stigma wuld be awful what with the notes on the windows and things. We couldn't face that.

hi, there is a post in this forum somewhere that i found incredible, but at the same time great, basically you can send them the keys back and be done with it. Speak to you trustee first of course. I'm sure that it is written into my td what will happen to any shortfall that i had

Yes i've heard of voluntary repossesion but I believe notices ect are still put on your windows which we really dont want, we live in a very small place where everyone knows everything about you so we dont want the stigma of repossesion.

Hi gillianr2.

I can understand your dilemma. At this stage I think you need to run the subject past your husbands Trustee and then revert back to NRAM with the reality of the situation.

If the Trustee is happy with the sale (or voluntary repossession) you'll be in the hands of NRAM about what the next stage is.

I'd hope that they would be agreeable to a conventional sale of the property as this typically will raise a higher price than selling a vacant property. This of course would potentially lead to a smaller shortfall loss for them.

Thanks alot, I will email the trustee today and see what she is. A bit worried about it to be honest as she isn't the most helpful of people and always makes you feel like you are bothering her, she also hasn't been very accurate with her advice in the past (told me I couldn't go bankrupt through lila and I could and did!).

NR cannot force your husband to pay any shortfall back to them, whether it is incurred before or after the end of the trust deed. They could decide to be awkward and not allow the sale to go through, but in that circumstance then you would simply surrender the property to them instead (or to your trustee). All they are entitled to is whatever they can get for the property, the protected trust deed means that they have no right to pursue any shortfall.

As far as I am aware, these properties are usually sold on the open market through an estate agency just like any other property - I don't believe there are usually any outward signs that it is being sold as a result of an insolvency or a repossession.

Thank you for the reply Kevin. That is really good to know that they cant pursue my husband for the shortfall. I was always under the impression that when you do a voluntary repossesion that they put up notices on your windows and then come and change the locks ect so that everyone else finds out you were repossesed? Nram certainly seemed to be less enthusiastic about repossesion than selling but in all honesty with where we live I think we will find it very har to sell the house anyway, we thought about approaching one of those companies that buy your house all be it for say 75% of the value. If we did do that though I think Nram would make it difficut to let us sell as say they gave us £67k that would be almost 30k short.

I think there is a good chance they would change the locks, for security's sake.

Speak to your trustee about it, they have an obligation to ensure that the best price possible is achieved and should liaise with any secured lender to try and achieve that.

Hi Gillian- Hope that i can give you some reassurance re your house. I have had my house repossessed and we voluntarily gave the keys back and told them how to contact us. They did go in and change the locks but no notice was ever posted in the window- not sure if that was because it was volunatary- we also had no trouble getting a lease on a new house despite our history and we did it through a letting agency, hope that gives you a wee bit of piece of mind.
Can i just check something from the other posts though- if there is a shortfall will the shortfall amount not just be added to the trust deed as another creditor?? or does the fact that the house repossesion took place (or sale if thats the route)and didnt cover the outstanding mortgage negate their claim?? im interested to know as its the shortfall from my repossession that is forcing me to think a trust deed is my only route
J

Hi Joni.

You're correct, the shortfall debt will become a trust deed creditor.

If you were to enter into a trust deed any shortfall debt that you already have would be one of your creditors.

Thank you for sharing your personal experience with gillianr2, that's really valuable insight and information.

Thanks very much Joni, it's great to have some insight. Husband has emailed his trustee this morning and is waiting to hear back.

Hi Gillianr2

I would agree with Kevin, that they have to change the locks for security purposes, but I have not known of anyone who had notices put on the windows! It is in nobody's interest to have an empty property if it can be avoided, as the property has to be checked regularly etc for insurance purposes.