Bancruptcy and joint house

furball · 9 July 2007 at 5:42PM

Hi sorrry if the answer is already here but i have searched and can't find it. My husband has been served papers where an unsecured loan has been sold and the creditors want to make him bancrupt. The house is in both our names and we have young children one under 3. Please can you tell us where we stand with the house, will we have to sell it. Thankyouin advance.

RAS · 10 July 2007 at 2:21PM

Furball

Other will be along who can help you more, but the starting point is.

If this is really going to happens (and it does sometimes)

How much is your house worth?
How much is your mortgage?
Do you have any other loans secured on the house?

BUT please post this over on the Debtfreewannabee board as a lot of the less savoury debt collectors threaten bankruptcy almost as a standard.

What the DFW crew need is the letter typed out, the name of the creditor and the amount of debt. In particular iis the letter from a solicitor or DCa or from a court?

You could try asking CCCS_Matthew for advice as he is on there now.

Otherwise please contact one of the free debt advice charities listed at the top of the DFW forum

CCCS_Matthew · 10 July 2007 at 2:30PM

Hi Furball,

First thing's first, what do the papers actually say? You will often find that creditors and/or collection agencies use choice language to try to scare you into making payments. Often they may say we may persure will court action, which could lead to bankrupty.

As RAS has alreasy mentioned, is it sent from the creditors themselves or is it an official court letter? Do the papers make reference to a statutory demand? These details are quite important in determining where the creditors stand with the outstanding debt. Try not to worry too much at this stage. If you would like to speak to someone in person you could always ring our helpline on 0800 138 1111 and someone should be able to discuss things further with you

Regards,
CCCS

RAS · 10 July 2007 at 2:51PM

I have snaffled this of rog, to whom I give thanks

Creditors, who are owed more than £750.00, by a debtor, have the right to commence proceedings to petition for that creditor's bankruptcy, by the service of a Statutory Declaration. The debtor has 18 days, from the service of the Statutory Declaration to either come to some arrangement with the creditor, or to contest the debt and apply for the Statutory Demand to be set aside.

If, at the end of this 18 day period, no arrangements have been made, nor has the debtor applied for the statutory demand to be 'set aside', then the creditor has the right to apply, to the courts, for the debtor to be declared bankrupt.

Bankruptcy does NOT automatically follow the serving of a Statutory Demand.

Many creditors will use a Statutory Demand as a 'last resort' to force debtors into paying a debt, but not all will resort to having the debtor declared bankrupt, due to various reasons including costs which, whilst they would be added to the debtor's estate in bankruptcy, the creditor has to pay these up front, with no guarantee of getting them back.

In addition, the petitioning creditor does NOT gain any preferential status over any of the debtor's other creditors.

Equally, there are many Debt Collection Agencies who, contrary to the guidelines, laid down by the OFT, will issue forms which are very similar, often indistinguishable from, the official Statutory Demand.

I would, therefore, advise anyone who receives a statutory demand, to take advice, either from a solicitor, or CAB, who would explain their options much better than I ever could.

Bancruptcy and joint house

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