My options after co-owner died without life insurance?

dmg11234

Hi, I wasn't sure what to title this. My fiance died last year aged 25, we took out a mortgage in 2009 for 235K and he was not approved for life insurance due to a heart issue. He was told if there were no occurences with his health after 5 years he could be insured however he died unexpectedly before that time. I had signed a waiver to say I was aware he was going into the mortgage without life insurance.

The mortgage has been frozen for a year while I try to sort out the other bills and things left behind. I have a meeting with the bank the week after next to see what my options are.

I really don't want or need to stay in this house anymore, at first I was determined due to sentimental value because it was my partner's home. I can't rent out the spare bedrooms due to having my partner's 2 dogs who tend to bark when I'm at work and also because the house was a project when we bought it and I don't have the money to make the bedrooms rentable.

Basically my question is for anyone who has experience or knowledge in this area, what are my options? Rent out the house and start paying the mortgage again? This isn't as easy as it sounds as the house needs a new boiler, the garden is not secure, the drainage system is f*ecked, among other things such as cosmetic work, all of which I can't afford.

Hand the house back to the bank and be liable for the negative equity? (about 50k) would debt forgiveness apply in my case under the circumstances? If so, is it likely to be the full amount of negative equity?

I never never would have been approved for this mortgage by myself. We barely made ends meet when we were on a 2 income household (him earning more than me) and even on interest only I could never meet the repayments myself

A job opportunity has come up for me in the UK beginning next year and (naive as I may sound) ideally I want to walk away from this house and owe nothing, and start fresh. I've googled debt forgiveness 100 times and to be honest I don't understand a lot of this, we used a broker who was a friend of the family so nothing was really explained as far as consequences in this situation etc. I think some strings were pulled to get us the mortgage, I really feel like two 21 year olds shouldn't have been approved for a mortgage that size with our earnings

Any advice would be much appreciated.

The_Conductor

First of all- I'm really sorry to hear about your fiance, I know that the financial mess you have on your hands is something you really don't need.

Debt forgiveness is still being dealt with on a case by case basis.
Much as I disapprove of people who abuse personal bankruptcy- if you have a genuine job offer in the UK and you intend to move over there and start afresh- you should do it sooner rather than later- and avail of personal bankruptcy procedures there, rather than here.

From the description you've given- it would appear that you have no hope whatsoever of paying even the interest component of the mortgage. If you were to seek debt forgiveness from the mortgage lender- you would be seeking to have the mortgage written down to the extent that repayments were not greater than 35% of your NET income (and with this there are numerous onerous stipulations governing your other expenditure). In return for this debt write-down, you get to keep the house.

It doesn't sound to me like you really want to keep the house- I know it will have many memories for you- perhaps ignoring the moral dilemma and accepting that personal bankruptcy is the better option in this case, might be the lesser evil?

You're half-way there with an acceptance that you want to start afresh, and a job offer in the UK. I'd put my best foot forward if I were you.