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Hi. I live in a mortgaged house with my wife and two children. It would sell for £120000. We own £90000 on the mortgage. We also have a secured loan on the property which would cost $50000 to pay off. We are in a lot of other debt too, and cannot afford to pay our bills each month let alone shopping/petrol.

We are going further and further into debt every day. We have cut back everything possible but still cannot afford a thing. We had sold the house, and was going to rent until we were back on our feet again, using the proceeds from the sale to pay off some of the debts and keep paying the loan off in full until it was gone, but the loan company would not release the charge on our property until they were paid off in full so the sale collapsed at the last minute.

We have heard of IVAs but do not know if one could help. If not I do not think we have a choice but bankruptcy. Please offer some advice. Many thanks.

Hi dave and a warm welcome to the forum

You have negative equity in your property, and the most important payments to continue to make are those to your mortgage company and secured lender, as these affect your home.

Have you sat down together and worked out an income and expenditure account, to see if there is any surplus income left at the end of each month once you have taken account of the household bills and other general expenditure - including shopping, car expenditure and clothing. If there is some money left, then you might be able to propose an IVA to creditors, but bankruptcy is also an option.

I suggest that you take more specific advice from an insolvency practitioner, who will be able to look at your case in more detail, or post more details about your income and expenditure on the forum and we will try to help.

Regards, Melanie Giles, Insolvency Practitioner for over 20 years.

To have me propose an IVA for you, please visit:
http://www.melaniegiles.com/ivaEnquiry.asp

See customer feedback at:
http://www.iva.com/iva_companies/IVA_Advice_Bureau.asp