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  • FIRST POST
    • keirshunt
    • By keirshunt 2nd Jan 18, 11:41 AM
    • 17Posts
    • 4Thanks
    keirshunt
    Student and Thinking about Bankruptcy (IPA advice)
    • #1
    • 2nd Jan 18, 11:41 AM
    Student and Thinking about Bankruptcy (IPA advice) 2nd Jan 18 at 11:41 AM
    Hi

    I am thinking about going bankrupt, well, I was. but I think my income is really high and so maybe I should be trying to pay my debts back. The reason i wanted to go bankrupt is some of the debts aren't mine (well they are in my name but they were taken out by someone else - a 'friend' and also I have a large loan I was a guarantor on.....I know, I was a fool). Anyway.....

    My question is;

    I am a student so I receive a loan which is a lot over the year and after all my expenses leaves me with loads of money. I have included my SOA below. Should I be thinking about a DMP instead? Or should I just pay the IPA that will be given to me?

    I have also contacted stepchange by advice but they are really busy so I've had to email them. Just waiting for a reply and thought I would start a thread here just incase anyone else has been in the same situation (or will be in the future).

    Thank you for any information anyone can give me



    Owe £55,000 (loan and credit cards)
    1 Adult
    1 Child

    Your Monthly Wages (after tax) 97.76
    Your Partner's Wages (after tax) 0
    Benefits (Working Tax Credits, Income Support, DLA, etc) 337.38
    Maintenance 347
    I ALSO GET STUDENT LOAN 11226 A YEAR (some of this is loan, some a grant I don't have to pay back as I'm a single parent
    other jobs, 0


    Mortgage payment 0
    Secured/HP loans 0
    Rent] 150.00
    Management Charge 0
    Council Tax 28
    Electricity 38
    Gas 30
    Oil 0
    Water Rates 34
    Home Telephone 60
    Mobile Phone 12
    TV License 12
    Satellite/Cable TV 0
    Internet Services 0
    Groceries etc. 300
    Clothing 69
    Petrol/Diesel 69
    Road Tax (car) 12
    Car Insurance (including breakdown cover) 13
    Car Maintenance (including MOT) 10
    Car Parking 0
    Other Travel 0
    Childcare/Nursery 0
    Other child related expenses 0
    Medical (prescriptions, dentists, opticians etc.) 10
    Pet Insurance/Vet bills 10
    Building Insurance 0
    Contents Insurance 9
    Life Assurance 0
    Other Insurance 0
    Presents (birthday, Christmas etc.) 10
    Haircuts 10
    Entertainment 0
    Holiday 10
    Household Emergency Fund (e.g. for repairs) 10
    Add another item

    Total In; 782.14
    Total In (with student loan); 1717
    Total Out; 906
Page 1
    • Arleen
    • By Arleen 2nd Jan 18, 3:52 PM
    • 1,116 Posts
    • 841 Thanks
    Arleen
    • #2
    • 2nd Jan 18, 3:52 PM
    • #2
    • 2nd Jan 18, 3:52 PM
    Even with the student loan/grant you only have 800 quid left a month, and that's before servicing debt. Granted you can easily cut some of your expenditures, so let's call it an even 1k available. 55k debt over 1000 quid is just about 55 months, also known as a lot more when interest will kick in on top of it so I think bankruptcy may be the right way for you.
    • KeepOnKnitting
    • By KeepOnKnitting 2nd Jan 18, 9:15 PM
    • 145 Posts
    • 180 Thanks
    KeepOnKnitting
    • #3
    • 2nd Jan 18, 9:15 PM
    • #3
    • 2nd Jan 18, 9:15 PM
    I went bankrupt partly to allow me the financial freedom to become a student. When I started university in the September, the official receiver told me that they had no further interest in my income and would not be implementing an IPA. They may take a similar view with you since your income is mostly benefits and student loan.
    • macman
    • By macman 2nd Jan 18, 9:41 PM
    • 41,565 Posts
    • 17,122 Thanks
    macman
    • #4
    • 2nd Jan 18, 9:41 PM
    • #4
    • 2nd Jan 18, 9:41 PM
    Is your rent really only £150pm?
    And your home phone (£60) should be half that amount (line rental and presumably broadband).
    Last edited by macman; 02-01-2018 at 9:43 PM.
    No free lunch, and no free laptop
    • keirshunt
    • By keirshunt 3rd Jan 18, 8:30 AM
    • 17 Posts
    • 4 Thanks
    keirshunt
    • #5
    • 3rd Jan 18, 8:30 AM
    • #5
    • 3rd Jan 18, 8:30 AM
    Thanks for the replies

    I spoke with Step Change yesterday for 3.5 hours in total.

    They recommended a DMP but said it would take 6.5 years to pay off my debts whereas even if I pay everything I have left over to an IPA it will be 3 years maximum so I have decided that is the 'best' option for me. When I said that to the woman she could see my point.

    They went through all my figures, made me increase some and said that none of them were glaringly wrong so that's good.

    Terrified of doing it so will wait a few weeks.
    • haggis0073
    • By haggis0073 3rd Jan 18, 8:56 AM
    • 84 Posts
    • 61 Thanks
    haggis0073
    • #6
    • 3rd Jan 18, 8:56 AM
    • #6
    • 3rd Jan 18, 8:56 AM
    if you add the revised SOA back on here from stepchange there might still be increases which you can tweak to help reduce the IPA (assuming you get one)

    How much is your car worth, as you can only keep your car if you need it for work etc and the value must be around the £1000 area

    When you fill in your expenditure on the BR forms the fuel section includes car parking, very often overlooked as an expense but soon adds up over the month, you can definitely up this easliy, also haircuts can be around 20-25,

    how old is your child? if at school then you can include school uniform costs, these too add up over the year, If a baby then things like bedding, nappies, prams etc all add up over the year

    If you get DLA then they will ask what its spent on (at least they did with me) just prepare an answer ready, although they should disregard the DLA as its for care needs
    • keirshunt
    • By keirshunt 3rd Jan 18, 9:11 AM
    • 17 Posts
    • 4 Thanks
    keirshunt
    • #7
    • 3rd Jan 18, 9:11 AM
    • #7
    • 3rd Jan 18, 9:11 AM
    Thanks Haggis0073

    Below is my updated SOA.

    My car is worth £530 (according to the parkers website), I use it for taking my daughter to school. We live in a village and it would be 2 buses there and back, we have thought about getting rid of the car....but as it's not worth much Stepchange said it would be ok.

    My dd is 14, I have included school uniform in the clothing bit. I must have put my benefits in the wrong bit as I don't get DLA, it's clearer in the SOA copied from step change!

    thanks if anyone has a look and spots anything




    Housing Amount
    Rent £494
    Mortgage
    Secured loan
    Charging / Inhibition order
    Mortgage endowment premium
    Service charge/ground rent
    Water £34
    Council tax (full time student so don’t pay)
    Gas Dual Fuel
    Electricity £68 Dual Fuel
    Other household fuels
    Household Services Amount Comments
    Building/contents insurance £9
    Telephone/mobile/internet £72
    TV licence £13
    Satellite £6
    Repairs/maintenance
    Household appliance rental
    Childcare
    Child maintenance
    Fines/CCJs/decrees £1 CCJmigo
    Life insurance/pensions
    Medical/accident insurance
    Hire purchase / logbook loan
    Transport Amount Comments
    Spares/servicing £14
    Road tax £12
    Insurance £15
    Breakdown cover £5 AA cover
    Fuel/parking £117
    Public transport
    Food & Housekeeping Amount Comments
    Food/toiletries/cleaning £275
    School meals/meals at work
    Pets/pet foods/insurance £16
    Tobacco
    Misc. Goods & Services Amount Comments
    School trips/activities £4
    Medicine/prescriptions £10
    Dentist/opticians £8
    Hairdressing £9
    Union/professional fees £6
    Laundry/cleaning £4
    Education fees
    Personal & Leisure Amount Comments
    Clothing/footwear £32
    Newspaper/magazines
    Sports/hobbies/entertainment £10
    Children's pocket money £10
    Religious Contributions
    Sundries & Emergencies Amount Comments
    Sundries & emergencies
    Loan from family/friends

    No of adults 1
    No of dependants 1

    Your Income Amount
    Take home pay £96
    Any other income received £1,086 (Student Loan + HB)
    Income Support / Universal
    Credit
    Jobseekers Allowance
    Incapacity Benefit/ESA
    DLA/PIP
    Working Tax Credit
    Child Benefit £87
    Child Tax Credit £234
    Child Support £347



    Total Income £1,850
    Total Expenditure £1,244
    Surplus (Deficit) £606
    • keirshunt
    • By keirshunt 3rd Jan 18, 9:12 AM
    • 17 Posts
    • 4 Thanks
    keirshunt
    • #8
    • 3rd Jan 18, 9:12 AM
    • #8
    • 3rd Jan 18, 9:12 AM
    Not sure why Amigo (of amigo loans) has a little smiley face with angel wings! I certainly do not have that opinion of them!
    • haggis0073
    • By haggis0073 3rd Jan 18, 12:37 PM
    • 84 Posts
    • 61 Thanks
    haggis0073
    • #9
    • 3rd Jan 18, 12:37 PM
    • #9
    • 3rd Jan 18, 12:37 PM
    i would put food down at 275pm and then add toiletries with 25pm making 300 in total
    MOT/servicing/ongoing maintenance i would put 25-30 pm
    fuel/parking i would put 130pm
    clothing at 40pm
    add school uniforms at 5pm
    hairdressing at 20pm
    newspapers/stationary at 5pm
    sports/hobbies at 20pm (if they ask say this is for modest uk holiday/day trips
    maybe add 10-20pm for savings
    i think pet foods come under housekeeping so i would reduce the pet category to 10 pm

    clothing and school uniforms are 2 different sections

    On the forms the prescriptions/medicines are in 2 parts, 1 part for yourself, the other for your children, if you get free prescriptions then you will need to explain what this money will be used for

    If accepted that is roughly an additional £97 Per month which brings it down to around £509 surplus

    There are far more experianced members on this forum who may be able to assist better than me, hopefully they will be along shortly

    I am not sure if a student grant is the same as an income but someone will clarify soon i hope
    • silvercar
    • By silvercar 3rd Jan 18, 2:40 PM
    • 36,419 Posts
    • 153,934 Thanks
    silvercar
    Not sure why Amigo (of amigo loans) has a little smiley face with angel wings! I certainly do not have that opinion of them!
    Originally posted by keirshunt
    You've typed CCJ: Amigo without the space between the ':' and the 'A'. That is the smilies code for an angel emoji.

    Sorry I can't help with anything more substantive.

    I am not sure if a student grant is the same as an income but someone will clarify soon i hope
    It is income, but you can deduct studying expenses as an extra expense is my understanding.
    • haggis0073
    • By haggis0073 3rd Jan 18, 2:57 PM
    • 84 Posts
    • 61 Thanks
    haggis0073
    You've typed CCJ: Amigo without the space between the ':' and the 'A'. That is the smilies code for an angel emoji.

    Sorry I can't help with anything more substantive.



    It is income, but you can deduct studying expenses as an extra expense is my understanding.
    Originally posted by silvercar
    so they could add studying costs to their expenditure to help bring it down a bit more, keirshunt, do you know how much your studying costs are per year? Never been a student but assume you would need books etc;
    • keirshunt
    • By keirshunt 3rd Jan 18, 3:11 PM
    • 17 Posts
    • 4 Thanks
    keirshunt
    so they could add studying costs to their expenditure to help bring it down a bit more, keirshunt, do you know how much your studying costs are per year? Never been a student but assume you would need books etc;
    Originally posted by haggis0073
    Hmmm, this year is my first year and I bought a lot of books, but technically you could get them from the library (I wasn't quick enough) or look online. You could use the computers at Uni so not need your own (mine is broken and I need a new one). So really you could do it for not much (I havn't because my computer is broken so I couldn't access stuff online ).

    The books cost me way over £300

    I do have to buy pens, paper, printer paper, ink cartridges regularly.

    I've had to buy loads to be honest, but i'm not sure if I could have done it cheaper so may get into trouble if I put it down.........
    • haggis0073
    • By haggis0073 3rd Jan 18, 3:17 PM
    • 84 Posts
    • 61 Thanks
    haggis0073
    you certainly wont get into trouble as that is what the money is for, the thing about bankruptcy is its a fresh start and you need to put in realistic figures of what you spend, as when you are bankrupt you wont have credit to fall back onto, if your books are £300 a year then i would certainly include that, there is a section for stationary so have a good think of what you spend and put that down also. Its not a case of finding the cheaper option, but the realistic option
    • keirshunt
    • By keirshunt 3rd Jan 18, 3:23 PM
    • 17 Posts
    • 4 Thanks
    keirshunt
    you certainly wont get into trouble as that is what the money is for, the thing about bankruptcy is its a fresh start and you need to put in realistic figures of what you spend, as when you are bankrupt you wont have credit to fall back onto, if your books are £300 a year then i would certainly include that, there is a section for stationary so have a good think of what you spend and put that down also. Its not a case of finding the cheaper option, but the realistic option
    Originally posted by haggis0073
    Ahh, ok, and then i just have to explain what it is....(so explain I'm at Uni etc)????

    thank you,
    • immoral_angeluk
    • By immoral_angeluk 4th Jan 18, 2:01 PM
    • 23,754 Posts
    • 22,635 Thanks
    immoral_angeluk
    You definitely need to include any costs incurred through your study, such as stationary, IT equipment, books, travel or season tickets etc
    Total 'Failed Business' Debt £29,043
    Que sera, sera. <3
    • ToxtethO'Grady
    • By ToxtethO'Grady 10th Jan 18, 4:53 PM
    • 90 Posts
    • 44 Thanks
    ToxtethO'Grady
    Hi there
    I know you've probably thought of this but...
    Just remember to keep all receipts for stationery, study aids etc as it's mainly a one off payment each year you may be asked to produce the main one for books for the study year. Try and keep any receipts for a month and live within the budget and you'll probably find that little bits and bobs take up money.
    For example; a coffee a day is about £2.50 if you go to uni 5 days a week and get a coffee for the 39 weeks of the study year that is £41 a month....I know I always have to buy a sandwich 1 or 2 times a week because I've forgot my lunch
    You are meant to live going through a BR and you can even add some money each month for a holiday.
    Make sure you can get through a year on your budget and you will find that if it's a realistic budget you will get less scrutiny from your case examiner.
    They want it to be a paper process really and it's the budgets that are significantly over/under spending or very tight to their handbook figures that will cause them to pause and look at them.So if it's high in one area and low in another because that's how you live you can explain it to them.
    Your student loan is not classed as income by the way in an IPA
    https://www.insolvencydirect.bis.gov.uk/technicalmanual/ch25-36/Chapter31/part7/part3/part_3.htm

    Hope this helps
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