Is bankruptcy an option

currer0409

My husband and i recently took out a joint IVA (April 08). We have since found that whilst we are not struggling as much as we were we wont have any improvement for the next 5 years and any increase to our income will automatically be taken from us. We are also paying back almost 90% of our original debt and they are now wanting to take our pensions too. We are now considering bankruptcy as an alternative to hopefully bring a speedier end to the large outgoings and were wandering if anybody could give me some advice as to whether we would be eligible or whether this is the worst idea possible!

We do worry about loosing our home and are currently in a shared ownership scheme where we only own 44% of our property which would only (at present) hold £5k in equity if we were to see at the moment (less costs). We are not expecting an easy answer to the problem & understand we will still have to make payments but as we are currently in a 5-6 year IVA we wont be able to get out of our 1 bedroom flat any time soon and with a 2 year old this is becoming an ever increasing problem and a severe strain.

Any advice please?!?

deedee_3

The first thing you need to do is talk to one of the debt charities as houses can be complicated. Will get links for you.

Advice on bankruptcy.

The court/judge will normally ask whether you have taken professional advice that bankruptcy is in your best interest. If they believe you have not taken proper or sufficient advice then your bankruptcy may be refused. There are many places and organisations that you can get advice from, but the ones that people on this board have found most useful are listed below:

Main recommended sources of help:

• Consumer Credit Counselling Service - Website: CCCS Telephone: 0800 138 1111
• National Debtline - Website: National Debtline Telephone: 0808 808 4000
• Citizens Advice Bureau - Website: Citizens Advice or visit your local CAB centre (find nearest)

Others:

• Business Debtline - Website: Business Debtline Telephone: 0800 197 6026
• Christians Against Poverty
• PayPlan
• TaxAid - Help with tax debts.

For general queries about bankruptcy you can contact:

The Insolvency Service Enquiry Line
Tel: 0845 602 9848
Email: [EMAIL="insolvency.enquiryline@insolvency.gsi.gov.uk"]insolvency.enquiryline@insolvency.gsi.gov.uk[/EMAIL]

(Please be aware that the enquiry line cannot give debt advice or counselling or advise you whether you should go bankrupt. They can only answer general/technical questions on bankruptcy)

Links curtsey of Fermi.

currer0409

Thank you for the advice, it seems further enquiries are the way forward. Do you know if they would be able to give me advice on what percentage of our earnings we would still be eligible to put forward after bankruptcy or is it based on your surplus income?

Broken_hearted

In your situation you don't need to go BR it would be a lifestyle choice. Plus you would still lose a chunck of your earnings. You need to speak to one of the charities who can work out exactly how much it will be.

peachyprice

Hi Currer,
The amount you would have to pay to the OR through an IPA is calculated on your surplus income after all your hosehold expenses are taken into account. But you will be allowed a much better lifestyle than you are in an IVA, the allowances are for a normal standard of living, not the scrimping you are expected to survive on in an IVA.

It's on a sliding scale starting at 50% of any surplus over £99 (below this they don't take anything) increasing to a max of 70%.