Why can't I tell them I'm going bankrupt?

macready12 · 4 August 2007 at 5:57PM

Hi. This site has been great for me so far, thankyou. Another question: As I'm in the process of filing for bankruptcy and am at the stage where I'm being bombarded with the phonecalls and the answerphone messages, how come much of the advice given by the debt charities etc insist that under no circumstances do you tell any of your creditors that your'e in the process of going bankrupt? Any advice appreciated, excuse my ignorance.

rog2 · 4 August 2007 at 6:20PM

macready12 wrote: »

Hi. This site has been great for me so far, thankyou. Another question: As I'm in the process of filing for bankruptcy and am at the stage where I'm being bombarded with the phonecalls and the answerphone messages, how come much of the advice given by the debt charities etc insist that under no circumstances do you tell any of your creditors that your'e in the process of going bankrupt? Any advice appreciated, excuse my ignorance.

Because your creditors will make life even worse for you if they realise that you are going to petition for bankruptcy. At best, they will issue defaults and send the debts to debt collection agencies, who will give you even more hassle. Some will try to sell you even more credit to 'consolidate' your debt, under the guise of 'avoiding bankruptcy'. At worst some will even try to lure you into an IVA so that they can earn even more out of your debt.
If you feel that there is already an industry of vultures, scavenging off of your misfortune - believe me - you ain't seen nothing yet.

wherediditallgo · 4 August 2007 at 7:33PM

You gain nothing by telling your creditors that you're going to petition for your own BR, as very few will believe you & fewer will use the information constructively. Those that don't believe you will continue to pester you as they've been doing already. Those that do believe you are likely to try to pressure you into all kinds of financial arrangements, & will lay it on really thick about the effect of going BR especially the stigma hoping that will make you sign up to what they try to persuade you is a good deal. Long-term it more than likely isn't - if it was, they could have offered it to you before, couldn't they? :rolleyes:

You're much better off fending off the creditors in whatever way you've been doing so far (if the phone calls are getting to you, you can send them a letter notifying them that you want all contact to be in writing) & keeping your plans to go BR to yourself. I've put the relevant letters here in case you need them.

If you have not yet requested that all communications are in writing and you are not yet BR, you can send them this letter:

Dear Sir / Madam,

Re account ref

I am writing to you to inform that I request all communications to me in writing. I do not want any further telephone calls made to me.

To continue to contact me by telephone after I have requested you not to constitutes harassment. I require all future communications in writing for future Court use. Do not telephone me again – remove any telephone numbers you hold for me from your systems.

Your telephone calls are in breach of the Office of Fair Trading guidelines. If you continue with them after the receipt of this letter, an official complaint, together with a log recording the times and frequency will be passed both to that office and to Trading Standards, For your information, all telephone calls are taped.

This type of debt collection method is contrary to the ‘Administration of Justice Act 1970’. In that it is intended to cause alarm and distress to the recipient. Your methods will not be tolerated. A formal complaint to the relevant authorities will be made.

Take further notice that continued telephone calls after receipt of a request not to call may constitute a criminal offence under Section 127 of the Communications Act 2003.

Communicate in writing and ONLY in writing. Your telephone calls will not be answered.

HOWEVER, CALLS WILL TRIGGER COMPLAINTS TO THE REGULATORY BODIES.

I trust I have made myself understood on this matter.

Yours,

If you HAVE already requested that all communications are in writing and you are not yet BR, you can send them this one.

By Recorded Delivery

Dear Sir,

Ref. XXXXX

Despite my letters regarding ANY communication from your company, which stated that I require ALL communications in writing, your telephone calls continue.

This behaviour constitutes harassment; the letters stated quite clearly to you that I require ALL communications in writing for future Court use. Do not telephone me again - remove any telephone numbers you hold for me from your systems.

Your telephone calls are in breach of the Office of Fair Trading guidelines. If you continue with them after the receipt of this letter an official complaint, together with a log recording the times and frequency of the calls will be passed both to that office and to the Trading Standards office. For your information note that ALL telephone calls are taped.

This type of debt collection method is contrary to the ‘Administration of Justice Act 1970’ in that it is intended to cause alarm and distress to the recipient. Your methods will not be tolerated. A formal complaint, containing copies of all correspondence including yours, has now been submitted to the relevant authorities. This will be relevant to questions of your fitness to hold a licence under the Consumer Credit Act, whether or not it results in a prosecution.

Take further note that continued telephone calls after the receipt of a request not to call may constitute a criminal offence under Section 127 of the Communications Act 2003.

Communicate in writing and ONLY in writing, your telephone calls will NOT be answered.

HOWEVER, CALLS WILL TRIGGER COMPLAINTS TO THE REGULATORY BODIES.

I trust that I have made myself understood on this matter,

Yours faithfully,

Once you have gone BR, you can give them the details of your case & tell them to contact the OR, as it does take time for the OR to contact them all. However, if they continue to call you after being informed, report them to the OR & put the phone down. If they write to you after being informed, send the letters to the OR (keep a copy for yourself).

betterlatethannever · 4 August 2007 at 7:47PM

Trust me Macrady, i WISH i'd listened to the aboves advice.
I blabbled that i was going BR (mostly in a fit of temper) and have been hassled ever since with ALL the stuff Rog says, in fact its quite spooky, its almost like Rog is living here with me, cos its EXACTLY what is happening to me., including debt consolidations.

macready12 · 4 August 2007 at 8:56PM

Massive thanks to all for the advise and info

BrandNewDay · 4 August 2007 at 10:31PM

Actually, it may have something to do with it being illegal to do so. I, too, told some pest to buzzer off because my husband was going bankrupt, and he went and tried to get us in trouble with the OR. Apparently, it is illegal to tell someone you're bankrupt in order to get someone to stop trying to collect on a debt.

We didn't actually get into any trouble - the OR said it was no big deal and it happens all the time. (I think the real problem is when you falsely tell someone you're bankrupt or going bankrupt.)

chimaera_2 · 6 August 2007 at 1:57PM

mmmm, i read this with interest.

My advice, from the CAB, was to write to each creditor and tell them that i intend to go BR on a certain date as i needed to defer as i did not meet the 'living at an address for the greater part of 6 months' rule (1).

Also in the letter i was told to offer them all a nominal £5 per month until i filed for BR.

Out of 12 creditors all except 1 declined the money, only Trevor Munn accepted it. The others still pestered, but only by post.

Intrestingly though, during period of the writting of the letters and the BR, one of the creditors sold the debt on !!!!!

(1) Also intresting to note, according to the financial expert at the CAB, living the greater part of 6 months at an address legally equates to 3 months and 1 day. So i was able to bring BR forwards.

wherediditallgo · 6 August 2007 at 2:14PM

No disrespect to the CAB, but I wonder how many of them have actually been on our end of debt problems.

Firstly, telling them you're going BR gets you nowhere. The creditors must hear that a lot (along with "cheque's in the post", "I'm paying it online this Friday" etc), so they're extremely unlikely to believe you. Secondly, there's no reason to offer them £5pm. The usual token amount is £1pm per creditor, but even that's an unnecessary payment if you know you're going BR in the next couple of months. And, if any creditors decline the money but don't do so in writing, giving money to the others could be seen as giving preferential treatment (something the OR does frown on), since you'd then have no proof they turned your offer down. If creditors have advance notice of your impending BR, they might well try to sell the debt on to recoup what they can, since they know there's little chance of them getting anything once you're BR (I'm not sure what the legalities of that are, since they're aware the debt would probably be non-recoverable, but that's between your creditor & whoever buys the debt). Selling the debt on might help them, but it doesn't help you at all.

Once you've decided to go BR, the priority should be getting the fees together, going BR as soon as you can, & making sure that your finances are organised before & after court. When things have gone this far, paying a nominal sum to a creditor shouldn't even feature.

rog2 · 6 August 2007 at 2:25PM

The advice given to me, also by CAB, was to immediately STOP paying all creditors. It seems that it could be a good idea to get a 'second opinion', when given advice by one counselling charity - whichever it may be.

macready12 · 6 August 2007 at 6:19PM

Thanks again guys. In a moment of head-in-the-sand madness I sent out standard letters to my creditors offering a token sum of £10 a month. Realise now I didn't need to do that as I was preparing for bankruptcy anyway, not that any of them have so far accepted. I'm guessing I'll need to tell the OR I've done that when I complete the petition?

BrandNewDay · 6 August 2007 at 7:07PM

Had you actually gone to court or filed anything? At any rate, I really don't think it matters. There's really nothing wrong with what you did.

Why can't I tell them I'm going bankrupt?

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