Advice on my situation

Arbee606 wrote: »

Hi,

I’m considering going bankrupt for the 2nd time (first time was in 2004), I have filled in an online form with Step Change and it suggested to do so but I have some quite unique circumstances and was hoping for a bit of advice. I have around £25k of unsecured debt, the vast majority of which was run up through gambling although, bar two relatively small slip ups, I haven’t gambled for nearly 3 years now. I lost everything and had to move home with my Mum several years ago and I am still stuck there now but the relatively low rent has enabled me to keep up to date with all of my repayments and my credit score isn’t too bad currently however I’ve had a few changes in my life recently so I need to make changes and I’m not sure on the best way to go about it.

Firstly, I have recently been diagnosed with Multiple Sclerosis which makes working full time difficult but as I only get statutory sick pay I cannot afford to have time off without falling behind on my repayments so I have been working when clearly not fit to do so. It does help explain my gambling to some degree (I have lesions on the brain that affect my decision making amongst other things) and I am due to start some medication soon which, although it should help my health in the long run, do potentially have nasty short term side effects and it’s highly likely that I’m going to need time off so my situation needs to change. I guess my first question is, would my diagnosis change my position with my creditors at all? Would I be able to negotiate any sort of reduced repayments or repayment breaks? Potentially, yes. If you can provide medical evidence then you could ask the creditors to write off the debts. Generally though, this would only work if you are unlikely to work gain in the future. You could in any event as an alternative make token offers to your creditors. You have little income and no assets so little to fear from court action or enforcement.

Also, my girlfriend (of 4 years yet we still don’t live together thanks to my situation) has had a promotion at work which has left her much worse off (she has lost tax credits and had to start her student loan repayments) and therefore needs us to get a place together as she is now struggling financially, this also coincides with my Mum retiring so she also needs me to move out and my cheap rent won’t be available for much longer. Obviously renting a place will be virtually impossible once declared bankrupt so I think I need to move first but this does raise more questions, it’s likely that I will first have to enter a 6 month agreement, if I am declared bankrupt during this time will they perform a 2nd credit check when I’m due to renew and potentially turf me out on the street? There is not much security in any private tenancy, bankrupt or not. Can't say whether a further credit check would be made - but the initial tenancy does not have to be renewed it can simply to continue to roll on month by month without renewing the tenancy - this is very common. At least if you do 6 months and demonstrate a good history, even if a check was made, you could point that you have a good payment record with them.

I also have a few general questions about bankruptcy:

Would I need to cancel my phone contract? I am on a sim only deal and have never missed repayments No, you could keep it.

I already have a basic bank account with Barclays which I opened after my first bankruptcy, will this be frozen? I don’t owe them any money although I do have a Barclaycard which is running up fast. The OR wont have any interest in this account and Barclays are likely to allow you to keep it - to be sure, why not open an new account with a bank you owe no money to (Barclays bank and Barclaycard being linked).

What about things like household bills? Will I still be able to open accounts in my name? For utilities, yes, might struggle with others.

Any advice would be much appreciated!