About to apply for bankruptcy and a bit nervous!

chickpeaz · 16 January 2018 at 12:59PM

I have £32,000 of credit card debt, pretty much all of this was built up when I ran a business that went into liquidation around a year ago. I kept loaning money to the business as I always thought it was going to be able to pay me back, but unfortunately we got badly screwed over by someone.

I rent a house with my husband who is earning hardly anything and I pay for most of our living expenses. Currently this is about £2000, including £600 credit card repayments (5 of them). I can just about afford this but it has meant not being able to afford basic things like clothes, and I have to put food shopping on the credit card meaning I am not actually paying any of it off. Over the past year as a result I have got £1500 further into debt and although most were on 0% transfer deals some of these are now starting to charge me lots of interest so payments have gone up from about £500 to £600. I don't feel able to deal with this any more so am just about to fill in the bankruptcy form.

I have two part time jobs as an employee but also recently started freelancing, though I'm not earning much (nothing in the past few months). For this reason I've been referred to Business Debt Line, who have been very helpful and I've spoken to them a few times.

A few things I'm not sure about:
1. My husband's only job finishes at the end of Jan and I don't know if he will be able to get any work. So I'm wondering whether it would be best to wait until he has something secure otherwise we might be in a difficult situation.

2. I have an Apple laptop (my only asset) that I paid £1500 for a couple of years ago. I'm worried they will take this away and I won't be able to pursue my new freelance career as I need it to do my creative work.

3. My bank HSBC were unhelpful when I rang to ask them what would happen to my account. They said unless I was already declared bankrupt they couldn't tell me what would happen or if I'd be able to keep my account. So I have no idea whether to (a) open a new account elsewhere now or (b) wait and see if I can keep my account.

4. Last week I was feeling wobbly about going bankrupt and thinking I would rather pay off my debts started transferring credit card balances (one for £4,500 and another for £700) in an attempt to reduce interest payments. Now I'm worried that this will look like I've been preferring creditors.

5. Because I have been just about managing to make repayments I'm not sure if my bankruptcy application will be accepted. When I put together the budget it includes things I'm not already paying for as I haven't been able to afford such as health insurance, pet insurance, clothes, haircuts, etc.

6. I'm also currently paying for my husband's car as it's on hire purchase and he hasn't been able to afford repayments for the last few months. Basically he is short of about £200 a month but is not prepared to get rid of the car (he has Aspergers and has trouble dealing with public transport). Not sure if I will be able to carry on helping him with this...

Would be grateful for any thoughts about this. I really can't carry on in the current situation, it's so stressful and has been keeping me awake at night. I just want a fresh start and a chance to look forward instead of feeling suffocated by these debts...

maxmycardagain · 16 January 2018 at 1:33PM

Firstly, get advice

maxmycardagain · 16 January 2018 at 1:34PM

Are all debts solely yours? no joint debts?

maxmycardagain · 16 January 2018 at 1:35PM

and do a SOA

chickpeaz · 16 January 2018 at 2:16PM

Thanks, yes the debts are all mine. I've just spoken again to Business Debt Line and I think they've pretty much answered all these questions! Going to wait another month to see what our income is if my husband can get a new job.

chickpeaz · 16 January 2018 at 2:16PM

Really appreciate this forum, it has felt a bit lonely being in this situation.

maxmycardagain · 16 January 2018 at 3:11PM

dont worry, its only money

haggis0073 · 16 January 2018 at 4:59PM

answer to question

2. Chances are if laptop was bought a couple of years ago then the value would have dropped significantly, i would not even mention the laptop under assets, if it ever did get bought up then say it was damaged a year ago and you sold it for spares although i highly doubt they would even mention anything

3. Chances are that unless its a basic account it will be closed, you could get your wages paid into your husbands bank account just before you submit, then after bankruptcy has been approved just go to barclays and open a basic account

4. you can explain the reasons for this to your official receiver

5. I personally made every payment right upto the point of bankruptcy, i never missed a payment and had no CCj or defaults, the fact you are paying your cards then using the money again for shopping etc shows me you are insolvent, and thats what this process is for, so no worries there

6. All down to the OR you get with this one, but if its your husbands debt then be prepared for them to disallow this as an expense

Please dont worry, what i did was go to the CAB and they sent out a letter to all my creditors explaining that i am getting advice and told them to put a 3 month hold on my accounts, this will give you some breathing space, then use the money you would of paid to the creditors towards your bankruptcy fee

About to apply for bankruptcy and a bit nervous!

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