Case Studies 50k Debt Reduced 22k

Scenario:

Solicitors settle for £3,000 on a debt of £50,663 following house repossession claim.
This case was referred by the debtor’s employer after the debtor received a letter from solicitors acting on behalf of a mortgage company demanding payment of £50,663 in respect of a shortfall incurred following the repossession and subsequent sale of the debtor’s property some six years earlier. The officer was in rented accommodation, had no assets to speak of and was unable to offer monthly contributions to the mortgage company because of other financial commitments.

Advice Given:

After assessment of the debtor’s liabilities it was established that the debtor had unsecured borrowing of £8,500 in addition to the mortgage shortfall of £50,663. With a level of liability at £59,163 he could consider and IVA, however this is not always the most suitable option. We decided that it would be far more prudent for both the debtor and the mortgage company to avoid an IVA under the circumstances, given that any fees payable towards both Nominee and Supervisors would be best directed in full and final settlement of the mortgage shortfall.

The Outcome:

After protracted negotiation, the solicitors acting on behalf of the mortgage lender accepted the sum of £3,000 in settlement of the debtor and his wife’s liabilities with money raised by family and friends. The debtor was then able to revert to paying his normal credit card repayments and therefore avoid any insolvency scenario.