Ashamed to be back again

I'm ashamed to have to come back here again. I went bankrupt in May 2012 and was discharged January 2013. All that debt was through no fault of my own, having left a DV relationship with little more than the clothes on my back I moved into a small empty flat. I had no idea I was entitled to benefits except child benefit so having had a nervous breakdown gained debts and hid under the duvet crying.

This time I have to take responsibility for it, I made a stupid decision. The garden had been 6ft-10ft brambles since I moved to this LA property and the wooden fences surrounding it had collapsed. So after 6 years of having nowhere for children to play or hang the washing out I stupidly paid for replacement fencing and the brambles to be cut, all on a credit card of 39.9% for which I thought I'd manage the repayments and more and would pay it off quickly. Things went from bad to worse and in trying to keep up repayments other debt appeared, I couldn't afford to eat etc and I've finally phoned stepchange for advice. The only feasible option is bankruptcy again. Stepchange say that as I've been bankrupt less than 6 years ago I will be treated in a harsher way, be bankrupt for longer, have a payment plan in place for 3-6 years and be constantly monitored.

I'm still just as ill. Been detained under the Mental health act twice in the last 2 years, I'm living on income related employment support allowance and PIP and that's very unlikely to change. I feel so low I'm fighting off 'way out' thoughts but I've got to try and take this one day at a time. I'm paying my 4 creditors £1 a month as the stepchange calculator says I have £5 a month spare however they said that the insolvency service are unlikely to allow me the allowances I've got on their form. That's help with my disability and specialist food for my eating disorder.

Apparently I have to open an account with the insolvency service and start paying installments and when I've paid £680 I can file for bankruptcy. That could actually take me ages. So I'm here for the long haul, paying £1 a month to 4 companies and saving in dribbles for the bankruptcy. I'm unsure how my mental health will hold up if the 4 companies don't agree that figure, give the debt to debt agencies or threaten court action. I am in pieces right now. And this time it's all my fault.
"Our prime purpose in this life is to help others. And if you can't help them, at least don't hurt them." Dalai Lama
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Comments

  • Why go BR?


    You are pretty much bullet proof as things stand


    Keep paying your essentials (rent/council tax etc) and pay £1 per month to your creditors (if you can afford it)


    The other option is you don't pay and they make you BR- then you save £680


    Another BR is possibly not a good option.


    How much is your total debt?


    Remember- DO NOT LET ANYBODY IN such as bailiff's etc.- talk on the mobile or through a letter box.
    If you don't let them in they cant take any assets inside the house.
    Keep your front door locked


    On a side point- get a new mobile number and use an old android mobile (beg off friends and family / kids) as a contact mobile for the debt collection people. Then you know who is calling by which phone rings.
    Many android phones have call recording apps and they will be on their best behaviour when calling if they know they are recorded.
  • PippaGirl_2
    PippaGirl_2 Posts: 2,218 Forumite
    edited 13 September 2017 at 5:55AM
    My debt is almost £6000

    The reason I decided BR is because any action from debt collection agencies or bailiffs would almost certainly send me into a mental health crisis and probably an enforced hospital admission.

    I owe 2 credit card companies, one catalogue and my local council for fencing work they completed having said I put the new fencing I paid for in the wrong place. I think it's highly unlikely any of these would make me bankrupt? More likely I'd be hounded by debt collectors for years.

    I rarely open the door to anybody. I have upstairs windows open, could they climb in these? That would terrify me, one diagnosis being PTSD following a long abusive violent relationship so a man climbing would be terrifying. I very rarely use a telephone. I have a payg which is the number I give companies and I never answer it. On my 'real' phone I receive texts from 2 of my children and my 2 friends. The only person I ever speak to on it is my GP so no one could obtain my number. Oh I do think my local council have my real number because it's the only way they will arrange appointments to make repairs. I wouldn't answer it though unless I can see my GP's number on the screen.

    I'm up to date with rent and all normal household bills.

    Stepchange said the credit card companies are very likely to think my food allowances and help in the home (eating disordered and degenerative disc disorder in spine, currently under the care of the spine clinic and pain clinic so these allowances are necessary in my and my GP's opinion) are too high and will take me to court in order to get higher payments. This would cause CCJ's but they'd be written off by any bankruptcy after that.

    So I feel BR is my only option. I'd wanted a DRO but Stepchange says I don't qualify as I've taken out a wonga 3 day loan to buy food twice in the last month plus the insolvency service would say my allowances are too high and I have spare money. Hence stepchange saying after the BR I will likely be making payments for 3-6 years.

    I'd been under the impression that if your only income is income related ESA and PIP they wouldn't take payments from you. The DWP paperwork says "this is what you need to live on" and the PIP covers disability costs, although not all of them, the ESA pays part of them too. I'm confused about how the insolvency service can take means tested benefit from you for several years.

    I can't cope with it all. Thanks for your response.
    "Our prime purpose in this life is to help others. And if you can't help them, at least don't hurt them." Dalai Lama
  • I'm so sorry to hear that found yourself in a financial state again :(

    Have you tried calling national debt line or getting an appointment with a debt adviser at the CAB? It really does not sound like the adviser you have been speaking to at stepchange has any empathy for your situation at all. Taking out a wonga loan recently seems like a ridiculous reason to be denied a DRO!

    I doubt very much your creditors will go to court for many months yet, I'm sure if you just pay the token payments for now nothing will happen whilst you save up the £90 for a DRO and by then, the wonga loans will be a few months older.

    I hope you get something sorted soon,

    H x
  • A friend has offered to pay the £90 for a DRO so I could do that straight away but I will decline her offer now that's not happening. It's a combination of taking out the wonga loan for 3 days and my allowances are too high and for a DRO you have to have nothing spare. I'm registered disabled and the help I need and the food my eating disorder creates means I don't have anything spare but I guess stepchange must know what the insolvency service would allow so they must be right?

    My local CAB no longer deal with debt, they leave it to stepchange. I could phone National debt line for a second opinion though I guess. Apparently you can't apply for a DRO yourself, an agency has to do it on your behalf so I can't just go ahead and ignore their advice if they're saying it's out of the question. I will see if I can muster the mental energy to phone the National debt line tomorrow. I'm drained and tearful now. It does seem stupid, the system.
    "Our prime purpose in this life is to help others. And if you can't help them, at least don't hurt them." Dalai Lama
  • Have you tried asking in the DRO thread on the IVA/DRO board? Im sure some of the people that post on that thread actually process DRO's so will be able to tell you if the insolvency service are likely to accept that your PIP money is for your health needs.

    H x
  • Thanks, will do.
    "Our prime purpose in this life is to help others. And if you can't help them, at least don't hurt them." Dalai Lama
  • Have you tried the Debt remedy tool on step changes website? I just did a dummy run on there, of course I don't know your circumstances but I just used the recommended figures and a DRO was recommended, they did not include the PIP in the income at all. They also did not ask if I had taken out a payday loan recently! Hopefully you just got an adviser lacking in knowledge when you spoke to step change and national debt line will be more understanding!

    H x
  • PippaGirl wrote: »
    So I feel BR is my only option. I'd wanted a DRO but Stepchange says I don't qualify as I've taken out a wonga 3 day loan to buy food twice in the last month plus the insolvency service would say my allowances are too high and I have spare money. Hence stepchange saying after the BR I will likely be making payments for 3-6 years.

    I'd been under the impression that if your only income is income related ESA and PIP they wouldn't take payments from you. The DWP paperwork says "this is what you need to live on" and the PIP covers disability costs, although not all of them, the ESA pays part of them too. I'm confused about how the insolvency service can take means tested benefit from you for several years.

    I'm unsure on the being denied a BRO because of the Wonga loans, but personally I have found that information from Stepchange can sometimes be completely inaccurate, I'm in no way knocking their service but I would also contact someone like National Debtline for a second opinion.

    I'm also pretty certain that benefits aren't classed as income, therefore they shouldn't be able to touch it.
  • I'm unsure on the being denied a BRO because of the Wonga loans, but personally I have found that information from Stepchange can sometimes be completely inaccurate, I'm in no way knocking their service but I would also contact someone like National Debtline for a second opinion.

    I'm also pretty certain that benefits aren't classed as income, therefore they shouldn't be able to touch it.

    I've just had a go at their online tool. It queried my food costs so I sent a message explaining why they are high. And it queried why I spend £20 a month on medicines instead of their suggested £11 so again I explained that. I will get an answer to those 2 queries within 24 hours then I can continue with the tool. It didn't question my pet cost which include dog walking at all.

    I will let you know their answer. Thank you.
    "Our prime purpose in this life is to help others. And if you can't help them, at least don't hurt them." Dalai Lama
  • Hi Pippa,
    Sorry it's gone wrong for you but things can soon be put right.
    I have no idea what Step-change are talking about so I'm not going to try and make sense of it.
    How much did you borrow in the two Wonga loans and did either get paid back?
    Could you post up your SOA on here and I will inform you of whether you qualify for a DRO on income / expenses grounds.
    If you do - then great, if you don't then we do something else.


    In bankruptcy you would pay nothing in to an IPA - you were right, it is not requested when you income is made up entirely from benefits. You were also correct that effectively your disability benefit does not count in the calculation of a DRO.
    DD
    Debt Doctor, Debt caseworker, Citizens' Advice Bureau .
    Impartial debt advice services: Citizens Advice Bureau Find your local CAB *** National Debtline - Tel: 0808 808 4000*** BSC No. 100 ***
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