Please help - I'm losing sleep over possible BR!

Entry_Leveller

Please help if you can – I’m losing so much sleep over my situation so I’m going to post all the info relating to my situation. Any help would be appreciated a million times over!

I was married but separated and later divorced (broke up 2 years ago, divorced 1 year ago). This left my ex-wife to live in the house we had a marital home for nearly two years. Although she told me she was paying the mortgage, she stopped paying it. It is now about to be repossessed and she has moved out (the house is now empty).

There is a secured loan attached to the house.

My finances per month are as follows (based on me living with my new girlfriend at rented accommodation)....

Phone £ 50.00
House insurance £ 10.00
Car insurance £ 50.00
Car maintenance £ 30.00
Car tax £ 15.00
Rent £ 275.00
Council tax £ 65.00
Bills £ 110.00
Union £ 12.00
Food £ 150.00
Fuel £ 200.00
Phone & Internet £ 10.00
Clothing £ 20.00
Other (e.g. Birthdays, haircut etc) £ 30.00
Credit Cards £ 220.00
Secured loan £ 370.00
Bank interest and fees £ 55.00
Pet (vet bills, food etc) £ 40.00
Breakdown Recovery £ 18.00
Total Expense £1,730.00

Income £1,725.00

Remaining -£ 5.00


Those in red above would be written off I guess, following BR.
I am in serious arrears with my credit cards and secured loan – it is only a matter of time until they take court action (I don’t know what this involves though).

The house is has little or no equity and the secured loan is a value of £39,000 (not including arrears added). My credits cards amount to £12,000. I also have an overdraft of £3,900 (hence the interest etc).

The secured loan I gather will become unsecured once the house is repossessed (there is no equity for them to take). It is in joint names with me and my ex-wife. The credit cards are in just my name. I did have an agreement with both the secured loan company and the CC companies – I was paying £100 per month to the CC companies and £300 to the secured loan company. The amounts shown in the list above are the original contractual monthly payments.
I stopped paying them because of various advice (and because I didn’t want to be paying them when my ex-wife was paying nothing towards anything at all!)

I spoke to CCCS and they gave several different recommendations and suggested I reassess the situation after the house is repossessed.
Now I am no longer paying the debts which leaves me with some money to actually live a bit more normally. But I am afraid that an Official Receiver may take money off me on an ongoing basis because of this.

The only assets I have are a car (worth around £2500) and a motorbike (worth around £1800). I don’t mind selling my car and using my motorbike as transport. Should I do this before BR or suggest it to the OR? Or should I sell my motorbike now to try to pay for some things therefore showing willing? Or is there an alternative?


This whole thing is mainly a result of my ex-wife having created this mess (my credit was squeaky clean before the break-up!) but I suppose the main questions are:-

1. Should I make myself bankrupt or wait for the creditors to do this (would they eventually do this)?

2. What should I do about the vehicle situation?

3. Are my expenses etc realistic and would an OR give me massive monthly payments after BR?

4. Also, if I was to go BR, would I be better to open a Co-Op bank account before or after the BR?

Please help!?

Thanks
Entry Leveller

dalip

Entry_Leveller wrote: »

Please help if you can – I’m losing so much sleep over my situation so I’m going to post all the info relating to my situation. Any help would be appreciated a million times over!

I was married but separated and later divorced (broke up 2 years ago, divorced 1 year ago). This left my ex-wife to live in the house we had a marital home for nearly two years. Although she told me she was paying the mortgage, she stopped paying it. It is now about to be repossessed and she has moved out (the house is now empty).

There is a secured loan attached to the house.

My finances per month are as follows (based on me living with my new girlfriend at rented accommodation)....

Phone £ 50.00
House insurance £ 10.00
Car insurance £ 50.00
Car maintenance £ 30.00
Car tax £ 15.00
Rent £ 275.00
Council tax £ 65.00
Bills £ 110.00
Union £ 12.00
Food £ 150.00
Fuel £ 200.00
Phone & Internet £ 10.00
Clothing £ 20.00
Other (e.g. Birthdays, haircut etc) £ 30.00
Credit Cards £ 220.00
Secured loan £ 370.00
Bank interest and fees £ 55.00
Pet (vet bills, food etc) £ 40.00
Breakdown Recovery £ 18.00
Total Expense £1,730.00

Income £1,725.00

Remaining -£ 5.00


Those in red above would be written off I guess, following BR.
I am in serious arrears with my credit cards and secured loan – it is only a matter of time until they take court action (I don’t know what this involves though).

The house is has little or no equity and the secured loan is a value of £39,000 (not including arrears added). My credits cards amount to £12,000. I also have an overdraft of £3,900 (hence the interest etc).

The secured loan I gather will become unsecured once the house is repossessed (there is no equity for them to take). It is in joint names with me and my ex-wife. The credit cards are in just my name. I did have an agreement with both the secured loan company and the CC companies – I was paying £100 per month to the CC companies and £300 to the secured loan company. The amounts shown in the list above are the original contractual monthly payments.
I stopped paying them because of various advice (and because I didn’t want to be paying them when my ex-wife was paying nothing towards anything at all!)

I spoke to CCCS and they gave several different recommendations and suggested I reassess the situation after the house is repossessed.
Now I am no longer paying the debts which leaves me with some money to actually live a bit more normally. But I am afraid that an Official Receiver may take money off me on an ongoing basis because of this.

The only assets I have are a car (worth around £2500) and a motorbike (worth around £1800). I don’t mind selling my car and using my motorbike as transport. Should I do this before BR or suggest it to the OR? Or should I sell my motorbike now to try to pay for some things therefore showing willing? Or is there an alternative?



This whole thing is mainly a result of my ex-wife having created this mess (my credit was squeaky clean before the break-up!) but I suppose the main questions are:-

1. Should I make myself bankrupt or wait for the creditors to do this (would they eventually do this)?It is veryrare fo a creditor to mke you bc. Not only does it cost them £1,000 they know they are unlikely to get anything back.

2. What should I do about the vehicle situation?Not sure,but suggest you leave it until you have made a definate decision

3. Are my expenses etc realistic and would an OR give me massive monthly payments after BR?Is the above income including your GF's contribution? Or is your basic wage £1,725.00 a mth?.

4. Also, if I was to go BR, would I be better to open a Co-Op bank account before or after the BR?Always best to open an account before bc.

Please help!?

Thanks
Entry Leveller

You are aware that the secured loan in joint names will fall to your ex-wife to pay when/if you go bc?

When you do a SOA you need to put the Total household bills as they stand not just your half.Then you add them all up and half them,put half as your GF contribution. if you GF is earning the same amount as you,if not her contribution will be slightly less. You then add your own personal allowances eg petrol,hair cuts,mot,insurance ect to your half of the household bills, that total then comes out of your income. It is this that the OR will base his decision on whether a IPA is applicible. Hope all that has helped.D

GettingHopeful

Hi, Just wanted to post a reply to say I had read and am sorry to hear you have had so many problems, difficult to say "don't lose sleep over BR" because it is a lot less bother and worry than I ever thought it was. The court and OR have been supportive.

I haven't really anything constructive to say on the expenditure, as I am not experienced enough as yet, but regarding the Co-op bank, yes, ring them and apply now and get wages paid in as soon as possible. 08457 240 752. Tell them you are going BR and you want a cashminder. They will do a minimal credit check over the phone and may be able to confirm then and there. You then need to take passport into a local branch and then ring in a week for the account no and sort code, elctron following afterwards.

Crossed with dalip's reply.

The only problem is one recently emerged on this board is that if you owe them money they may not now set up the account. If that's the problem, try the Barclays option too.

I told the OR that the Co-op account was for pensions income and wages and they wrote and informed the bank that they had no interest and account was not frozen.

All the best. Am sure someone more informed will comment on the other points.

rog2

Entry_Leveller wrote: »

1. Should I make myself bankrupt or wait for the creditors to do this (would they eventually do this)?

Whilst possible, it is doubtful that your creditors are going to petition for your bankruptcy without first having made your life as miserable as possible.
If at all possible - I would suggest that you petition for your own bankruptcy before this happens.

2. What should I do about the vehicle situation?

Very doubtful that OR will let you keep both car AND motorbike. Also could rouse suspicions if you were to 'sell' the car just before declaring bankruptcy, and were unable to account for the money that such a 'sale' raised. One thing though, it may be acceptable if you had to sell the car to raise the money for your bankruptcy cost.
If you need a vehicle for work, the OR may let you keep the car OR the bike, although he/she could 'sieze' them and give you some 'cash' (probably around £500) to buy a cheap 'runabout'.

3. Are my expenses etc realistic and would an OR give me massive monthly payments after BR?

You would probably have to look at your expenses, although there would be no end of help, from this board, as to what is and is not acceptable.

4. Also, if I was to go BR, would I be better to open a Co-Op bank account before or after the BR?

Mixed opinions on that, EL - The OR is unlikely to require that you close a basic account, but the decision will, ultimately, be for the Bank to take. Personally I would wait until you have been declared bankrupt before opening a basic account.

Of course you must, also realise that, since it is in joint name, the original creditor will pursue your ex-wife for payment on the whole of the loan.

dalip

If after you read my reply you put up another i&e sheet we can go over it for you and see what we think the OR might allow.D

Entry_Leveller

dalip wrote: »

You are aware that the secured loan in joint names will fall to your ex-wife to pay when/if you go bc?

When you do a SOA you need to put the Total household bills as they stand not just your half.Then you add them all up and half them,put half as your GF contribution. if you GF is earning the same amount as you,if not her contribution will be slightly less. You then add your own personal allowances eg petrol,hair cuts,mot,insurance ect to your half of the household bills, that total then comes out of your income. It is this that the OR will base his decision on whether a IPA is applicible. Hope all that has helped.D

Thanks Dalip. The income is actually my own rather than joint with my GF. The house expenses that I put though are half - she pays the same as her income is similar.

Many thanks
EL

dalip

Entry_Leveller wrote: »

Please help if you can – I’m losing so much sleep over my situation so I’m going to post all the info relating to my situation. Any help would be appreciated a million times over!

I was married but separated and later divorced (broke up 2 years ago, divorced 1 year ago). This left my ex-wife to live in the house we had a marital home for nearly two years. Although she told me she was paying the mortgage, she stopped paying it. It is now about to be repossessed and she has moved out (the house is now empty).

There is a secured loan attached to the house.

My finances per month are as follows (based on me living with my new girlfriend at rented accommodation)....

Phone £ 50.00 is this including mobile,if so seperate out
House insurance £ 10.00
Car insurance £ 50.00
Car maintenance £ 30.00
Car tax £ 15.00
Rent £ 275.00
Council tax £ 65.00
Bills £ 110.00 ???? Is this gas/elect
Union £ 12.00
Food £ 150.00 up to £170
Fuel £ 200.00 Bit steep.....ah is this petrol??
Phone & Internet £ 10.00 Add this to landline. The OR will not allow internet unless you can prove you need it for work
Clothing £ 20.00 up to at least £40,if you need smart clothes for work you can add more
Other (e.g. Birthdays, haircut etc) £ 30.00 Make this birthdays/hol


Credit Cards £ 220.00
Secured loan £ 370.00
Bank interest and fees £ 55.00
Pet (vet bills, food etc) £ 40.00 Only usually allow £20
Breakdown Recovery £ 18.00
Total Expense £1,730.00
ok how about dentist,optic,percriptions ,haircut(all £10 per thing)dry cleaning,tv licence.
Income £1,725.00

Remaining -£ 5.00


Those in red above would be written off I guess, following BR.
I am in serious arrears with my credit cards and secured loan – it is only a matter of time until they take court action (I don’t know what this involves though).

The house is has little or no equity and the secured loan is a value of £39,000 (not including arrears added). My credits cards amount to £12,000. I also have an overdraft of £3,900 (hence the interest etc).

The secured loan I gather will become unsecured once the house is repossessed (there is no equity for them to take). It is in joint names with me and my ex-wife. The credit cards are in just my name. I did have an agreement with both the secured loan company and the CC companies – I was paying £100 per month to the CC companies and £300 to the secured loan company. The amounts shown in the list above are the original contractual monthly payments.
I stopped paying them because of various advice (and because I didn’t want to be paying them when my ex-wife was paying nothing towards anything at all!)

I spoke to CCCS and they gave several different recommendations and suggested I reassess the situation after the house is repossessed.
Now I am no longer paying the debts which leaves me with some money to actually live a bit more normally. But I am afraid that an Official Receiver may take money off me on an ongoing basis because of this.

The only assets I have are a car (worth around £2500) and a motorbike (worth around £1800). I don’t mind selling my car and using my motorbike as transport. Should I do this before BR or suggest it to the OR? Or should I sell my motorbike now to try to pay for some things therefore showing willing? Or is there an alternative?




This whole thing is mainly a result of my ex-wife having created this mess (my credit was squeaky clean before the break-up!) but I suppose the main questions are:-

1. Should I make myself bankrupt or wait for the creditors to do this (would they eventually do this)?

2. What should I do about the vehicle situation?

3. Are my expenses etc realistic and would an OR give me massive monthly payments after BR?

4. Also, if I was to go BR, would I be better to open a Co-Op bank account before or after the BR?

Please help!?

Thanks
Entry Leveller

Try the adjustments that i have done and see how it comes out.D

Entry_Leveller

dalip wrote: »

If after you read my reply you put up another i&e sheet we can go over it for you and see what we think the OR might allow.D

Thanks - a revised version is below for Income/Expenditure:-

My own expenses (p/m)
Phone £ 50.00
Car insurance £ 50.00
Car maintenance £ 30.00
Car tax £ 15.00
Union £ 12.00
Fuel £ 200.00
Clothing £ 20.00
Other (e.g. Birthdays, haircut etc) £ 30.00
Pet (vet bills, food etc) £ 40.00
Breakdown Recovery £ 18.00
Total: - £465

Credit Cards £ 220.00
Secured loan £ 370.00
Bank interest and fees £ 55.00
Total contractual repayments to creditors - £645

Joint Household Expenses (p/m)
House insurance £ 20.00
Rent £ 550.00
Council tax £ 125.00
Bills (gas, electric, water) £ 220.00
Food etc £ 270.00
Phone & Internet £ 20.00
Total: - £1205
Halved with Girlfriend = £602.50 each

My own personal Income £1,725.00

Personal Expenses - £475
Household Expenses (my half) - £602.50
Total contractual repayments to creditors - £645
Total Expenses £1722.50

My girlfriend earns similar to me so is paying half of the household bills.
The creditor repayments (in red) won’t be there after the BR of course though so that would leave surplus?

Many thanks
EL

Richard_S

Hi Entry Leveller,

It's obvious that you've got quite significant debts, and your creditors will make your life hell in pursuing them. I agree with the previous posters that it's unlikely a creditor will petition for your bankruptcy but they may well pursue you through the County Courts, and you'll end up with CCJ's and possibly an attachment of earnings. The upside of bankruptcy is that it'll draw a thick black line under your past and none of your creditors will be able to pursue you.

The downside is that if you've got a joint income of approximately £3.5k per month then you will end up paying an IPA for 36months. It's very difficult to forecast how much that is likely to be because the O.R's are not consistent with what they will and won't allow.

Personally, I think that is a price worth paying, because it would take you years to clear that debt through a DMP, and your credit rating would be almost as bad as if you'd declared bankruptcy.

Another plus point for bankruptcy is that if your circumstances change within the 3years of the IPA, e.g. one of you lost your job, or your girlfriend had a baby, then you amend your I&E accordingly, and the IPA is either revised or suspended.

If one of the Debt Charities has suggested that bankruptcy is in your best interests then I would certainly go down that route. It's not an easy path, but it does give you the chance to start again, and the mistakes of the past won't affect your future.

Best regards

Richard

fiveyearplan

Hi EL - I don't really have anything to add. The previous posters have given excellent advice that I would agree with. All I can add is I'm not sure 40 would be allowed for pets and if you do have to wear smart clothes for work you could add dry cleaning.

Entry_Leveller

Thanks everyone for these replies - It's so good to know I can get this support and help from people who have similar experiences. If anyone else has anything to add - I'd be really grateful to hear. I may have some more questions too as this progresses.....

Thanks again
EL