How it started
My nan left me some money when she died. I used it as a deposit on a flat. It felt like the right thing to do with her money. Something lasting. It didn't last.
We had been struggling for some time — after I got pregnant, my income dropped but we still had the same bills. A creditor arrangement with Lightside made an enormous difference, and we were managing.
Then the mortgage rate went up. It sounds like a small thing written down, but it was the thing that made everything impossible. Before the rise we were stretched. After it, the mortgage alone took more than we were bringing in. There was no version of the numbers that worked anymore.
We had already fallen behind on the mortgage by the time the lender began repossession proceedings. Losing that flat — the one I had bought with nan's money — was one of the hardest things I have been through. And when it sold, it sold for less than we owed. The debt didn't end with the repossession. It followed us.
The Outcome in brief
Adviser: Priti Shah · Referred by Lorraine Sellwood, IFA, Phase 8 Ltd
“Priti was the calm voice of reason and explained our options, all the paperwork was done on our behalf and she accompanied us to the County Court on the day of Bankruptcy. She talked us through what the Official Receiver would say and therefore the phone interview was less stressful than anticipated. All the way through our dealings with Priti, she has prepared us for worst case scenarios so there have been no surprises and she is obviously an expert in her field and understood completely what we were going through and what needed to be done.
We cannot praise Priti highly enough, she made a horrible and distressing situation that much calmer and we continue to be reassured that she is at the end of phone should we have any more questions or problems. Without gushing too much, we think she is an amazing woman and I dread to think how we would have coped if she had not been there for us. Anyone who is struggling financially needs a Priti in their lives!”
Mr. & Mrs. V, West London
If your debts are so large that even cutting back isn't enough
if the numbers simply don't work — bankruptcy might be the right answer. It sounds like the end, but it's actually a beginning.
The work behind the outcome
Bankruptcy gave a young family a fresh start.
When Mr and Mrs V came to us, the situation was already under significant pressure: credit card and loan debt accumulated through a period of inconsistent income. This was addressed and brought under control through a creditor arrangement.
The mortgage rate rise changed the calculation. What had been a workable position became unworkable almost immediately — the mortgage alone was absorbing more than the household was bringing in. We reviewed the position again in full. The question of whether the property could be saved was one we considered directly. The arrears were significant, the income had not recovered, and the lender had already begun proceedings. The honest assessment was that the numbers did not support a realistic path to retention, and giving clients a clear-eyed view of that, rather than false hope, is part of what we are there for.
When the property was repossessed and sold, it realised less than the outstanding mortgage balance. That difference — the shortfall — did not disappear with the keys. It became an unsecured debt the lender was entitled to pursue, adding a further significant sum to what was already owed. Combined with the existing credit card and loan balances, the total position made any realistic repayment plan impossible.
At that point our recommendation was clear: bankruptcy was the appropriate route. It would bring every debt — including the mortgage shortfall — within the bankruptcy estate and write them all off. We prepared the application and managed all correspondence with the Insolvency Service. We prepared them thoroughly for the Official Receiver interview so that nothing came as a surprise, and attended the Official Receiver interview with them.
Bankruptcy gave a young family a fresh start.