bankruptcy

dialysis · 3 March 2008 at 2:58PM

Hi everyone
Need a bit of advice about bankruptcy. My husband and I are considering going into bankruptcy. Up unitl four months ago we were both working with decent wages coming in. Unfortunatly i have had to finish work through ill health and consequently our income has dropped. We have four unsecured loans, a mortgage and a large secured loan. We have had our house valued and with the mortgage and secured loan we are in negative equity by around £60000. When we go bankrupt does anyone know if the OR will take our home and also does our secured loan go onto the bankruptcy? Also we own a car which is worth around £2000 and a motorbike worth £2000. My husband needs transport to get to work, what will happent to these? Any advise about bakruptcy would be appreciated thank you

m.colak · 3 March 2008 at 10:47PM

Hi everyone can some people with a bit of knowledge help this lady out please.

strongboes · 3 March 2008 at 11:15PM

Yes your house is your only real asset and so the official receiver will sell it to pay your creditors. You will be able to keep either the car or bike for your husband to travel to work but not both. All debts will be included in the bankruptcy. You will be debt free.

You may have an income payment order against your husbands wages if after they work out what you need to live on, there is any monies left.

I went bankrupt in nov 06 and was discharged by june 07. I was only earning 160 per week after tax and i was subject to no restrictions, I was single and have no dependents.

You would be allowed funds to eat, rent accommodation e.t.c. It is not too harsh.

For me it was the best thing I could ever do as worries about money instantly disappeared!

google for bankruptcy advice there is alot to read up on.

chevalier · 4 March 2008 at 12:23AM

I would put this question on the bankruptcy and living with it sub forum for advice. Unlike the previous poster, I am under the impression that the OR would NOT sell the home if it is in negative equity, because it would not help the other unsecured creditors. This is because the mortgage holder, and the secured loan lender have first dibs on any money made from the house sale.

Are you sure there is no other way than bankruptcy? It is a bit step and one you should take advice on, as it will trash your credit rating for long after you are discharged.

best of luck
chev

CCCS_Sarah · 4 March 2008 at 12:33PM

Hi dialysis,

Just been having a read of your post. I think the best thing here would be for you to come for an appointment and speak to a Counsellor. On the appointment we would help you put together a Financial Statement and then look at all the options that are available and we can look a bit more into your circumstances. If Bankruptcy is an option for you we will support you through the process and talk through what to expect.

Sorry to be a bit vague but I don’t know enough of your circumstances from your post and don’t want to give you incorrect advice. You can contact our helpline on 0800 138 1111. Once you have had your appointment if you have any further questions feel free to PM me or post on the Bankruptcy Support Sub Board

Good Luck

Sarah

dialysis · 4 March 2008 at 6:21PM

Hi there thank you all for your help and advice. Firstly Sarah I will get in contact with the CCCS tomorrow. Anyway I need some more advice please. I got in touch with the national debt helpline yesterday and they have sent me a load of info and advice. Hubby and I did our income and expediture today and it does not make pleasant reading. Basically our outgoings are more than our incomings, you know the story:eek: I decided to get in touch with our secured loan and our mortgage and they have agreed to let us pay half the monthly payments for the next two months. Unfortunatly the can only help for short term and it looks like my illness will prevent me from working for quite a few months. So long term we are in trouble. My salary has now reduced to half pay and that will last fro two-three months, then I will go onto incapacity benefit, which is far less than my half salary. So then we will be deeper into trouble. I also wrote to my creditors with token payments only as that is all we can afford. I asked them to stop the interest to prevent further debt.
The way we see our situation is our options are:

Go BR hopefully keep the house, negative equity and continue to struggle to pay mortgage and secured loan

Go BR sell the house, rent and the shortfall on secured loan will go to BR

Give house up go for voluntayr repo

Stop paying everything and let them repossess and make us bankrupt.

Dont know what to do. had enough really. on anti depressant as it is, husband off work with stress, just feel like saying stuff it. we are also in process of fighting our secured loan company over missold PPI, we were not aware I was not covered on insurance for illness, if it wasnt for this we would be OK loan would be paid. How do they expect you to survive when you lose one salary. they still expect premiums and are chasing both of us for it. Anyway thats another story which is posted on the PPI forum.

Sorry it is long just need bit more advice. Thanks foryour help:T

fermi · 4 March 2008 at 6:29PM

Have a chat with CCCS as well. See how their opinion compares with National Debtlines'. Professional advice is a must.

But you may also want to post on the MSE: Bankruptcy & Living With It board.

There are people on there who have been in your position, and have experience on the options you listed below.

dialysis wrote: »

The way we see our situation is our options are:

Go BR hopefully keep the house, negative equity and continue to struggle to pay mortgage and secured loan

Go BR sell the house, rent and the shortfall on secured loan will go to BR

Give house up go for voluntayr repo

Stop paying everything and let them repossess and make us bankrupt.

The only thing to add is that the last option is unlikely to happen. Apart from owing major money to HMRC, most creditors won't make you bankrupt. It costs THEM too much money to do.

MissEyre · 4 March 2008 at 6:29PM

Hi there,

Sorry to hear about your health troubles-it must be a worrying time for you. If you speak to CCCS, they will be able to guide you through the options and support you with creditor negotiations-if I were you, I would make an appointment with them as soon as possible, and then take their advice when it comes to toke payments etc, as they have lots of experience in doing this.

x

dialysis · 4 March 2008 at 7:25PM

thank you to all will contact CCCs tomorrow and get an appointment, keep you posted:T

fermi · 4 March 2008 at 11:20PM

dialysis wrote: »

thank you to all will contact CCCs tomorrow and get an appointment, keep you posted:T

Good. It's a stressful time, but others have got through it, and so will you.

m.colak · 5 March 2008 at 9:47AM

Hi dialysis i hope your appointment goes/went well and i hope you get lots of good advice:A

bankruptcy

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