questions about bankruptcy and IVAs

honeybloom1

ok here goes me and my husband own our own business which isnt going well to the point we need to close it down,we have 2 small children and not sure the best way to do things,we own a quarter share in a housing association house if we went bankrupt would we lose the house,and do the council or housing associations have a responsibility to rehouse us,we are not in arrears with rent or mortgage yet,also what stuff do they take if you go bankrupt,we have a small car which we are still paying for,will they take that? but appart from that we have no real assets or savings?can anyone give me some advice?we owe about £25,000 in debt,I know there is going to be legal fees involved and maybe rent arrears from our business that isnt included in that sum,any advice needed?

RAS

Hi Honey

The housing situation can be a bit difficult with BR, but basically, if there is no equity and you would have to pay as much to rent another place of a similiar type locally as you have to pay for your current mortgage and rent combined, it should be OK.

If there is any equity, then you can buy the Beneficial Interest as it is called back from the OR by re-mortaging. Given the state of the housing market, then the sensible thing would be to wait until your discharge is due, as there is likely to be less equity.

The other factor is that you need to check the small print on your agreement with the Housing Asscociation in case it prohibits BK

Have you taken proper advice from a debt charity? Any judge will insist that you have this before allowing you to go BK.

And once you have done this, post up on the Bk forum above and talk to the lovely folk on there, who either are Bk or are going BK at the mo.

skylight

Hello and Howdy missus!

Houses - BR does not neccesarily mean you will lose this. If you are up to date with the mortgage Great! Do you have anything secured against it though? What the value/equity of the property? Any equity of yours would be a quarter, and that quarter is divided equally between you and OH, so possibly not a lot (if anything). If there is nothing to take AND you can keep up the repayments (and repayments of anything secured on it, which I doubt as you only oen 1/4), you may find you will not lose your home at all - there is nothing for the OR to take. The HA does not have a responsibility to re-house you *if* you were to lose your home and this is regarded as making yourself intentionally homeless - but because you have children they have a duty of care, so will put into temporary accommodation for however long their policy is for (or perhaps rehouse you, but again, HA's differ in policies....).

The car. Is it on HP? Whats its value? Whats its used for?

Legal fees are £150 court fees EACH (which on very low incomes/certain benefits can be waived, but check the HMRC website for details) and OR fees of £345 EACH which will have to be paid regardless and theres no getting out of that one!

Is your business sole traders? Then all debts WILL be included in bankruptcy. The debts that are not, are student loans and CSA arrears really.

honeybloom1

skylight wrote: »

Hello and Howdy missus!

Houses - BR does not neccesarily mean you will lose this. If you are up to date with the mortgage Great! Do you have anything secured against it though? What the value/equity of the property? Any equity of yours would be a quarter, and that quarter is divided equally between you and OH, so possibly not a lot (if anything). If there is nothing to take AND you can keep up the repayments (and repayments of anything secured on it, which I doubt as you only oen 1/4), you may find you will not lose your home at all - there is nothing for the OR to take. The HA does not have a responsibility to re-house you *if* you were to lose your home and this is regarded as making yourself intentionally homeless - but because you have children they have a duty of care, so will put into temporary accommodation for however long their policy is for (or perhaps rehouse you, but again, HA's differ in policies....).

The car. Is it on HP? Whats its value? Whats its used for?

Legal fees are £150 court fees EACH (which on very low incomes/certain benefits can be waived, but check the HMRC website for details) and OR fees of £345 EACH which will have to be paid regardless and theres no getting out of that one!

Is your business sole traders? Then all debts WILL be included in bankruptcy. The debts that are not, are student loans and CSA arrears really.

yes the car is on hp and its about £3000 we only have 1 year left for it to pay,its used to get my husband to work and anyother furture jobs he might need to do after our business closes,we are sole traders and we are also a partnership,we own a 20% share in our house which is worth about £97,000 if that,we are desperate to move as we dont have enough bedrooms or space,will look into the small print but honestly dont think it mentions it unless I have just missed it?

RAS

How much is the mortgage?

honeybloom1

about £25,000

skylight

As the car is on HP, then check your HP contract with a damn fine tooth comb. Some have BR clauses that they will take the car back regardless.... The OR is unlikely to have any interest in it as it does not legally belong to you, it belongs to the HP company. And some HP companies could not care less about BR, as long as you continue to pay whats owed (which you can do in your income/expenditure). In your case there is less than a year to go and its a lowish value car. Check it out anyway.

You must speak to CCCS or Payplan about this. A judge can refuse to issue BR if you have not taken professional advice - and MSE is not professional enough!

I doubt you will be able to move house during BR at all. If there is no equity, as mentioned, you should be okay in keeping it, but you will never get a mortgage in this climate being BR. Even after BR its going to be tough going for one, but not impossible (higher than average interest rates etc). As you own the home (albiet partially) there is unlikely to be a BR clause - but check it out pronto too!

honeybloom1

well I was thinking of selling the house and renting elsewhere but this was something I would be thinking about when we are bankrupt,not sure how easy it would be to rent elsewhere?

RAS

honeybloom1 wrote: »

about £25,000

no equity then.