More BR Questions..

kevj1977

Firstly, sorry for posting again, but I am very confused about bankruptcy.

I have read a few posts from people considering and/or going through BR and have a few questions myself.

My first post is here:
http://forums.moneysavingexpert.com/showthread.html?t=1122205
This has my current situation and SOA on it.

Here are my questions:
1 - I have read about people stopping paying their debts and storing money for when they become BR. Will the OR/Courts not look at this and take the stored money towards paying my creditors?
2 - When my house is repossessed, if, after mortgage co sells house on, there is a shortfall in equity, can they charge me for it?
3 - I recently spoke to my financial advisor, and he said that the OR will usually get my wages paid into their accounts and give me "pocket money" to live off, has anyone had any experience of this??
4 - Will the courts accept a BR Petition if I have no "nasty" letters from my creditors?
5 - My Ltd Company has £9k of debts to the taxman, will these be wiped clear too?

Thanks in advance. If I think of any more questions, I will post them.

jo70

Can't help too much i'm afraid. But just to let you know that there are some really informative people on here who i'm sure will be along at some point to help you.
All the best J & A

RichOneday_2

Here are my questions:
1 - I have read about people stopping paying their debts and storing money for when they become BR. Will the OR/Courts not look at this and take the stored money towards paying my creditors? Not within reason, but if you've obviously salted away £5k the OR will want to know where its gone, but you're going to need some sort of reserve to see you through the process.
2 - When my house is repossessed, if, after mortgage co sells house on, there is a shortfall in equity, can they charge me for it? The shortfall is written off in the bankruptcy.
3 - I recently spoke to my financial advisor, and he said that the OR will usually get my wages paid into their accounts and give me "pocket money" to live off, has anyone had any experience of this?? No. You get paid in to a new account that you set up and control.
4 - Will the courts accept a BR Petition if I have no "nasty" letters from my creditors? Yes
5 - My Ltd Company has £9k of debts to the taxman, will these be wiped clear too? No, the Ltd company is a separate legal entity

CG77

[quote=
Here are my questions:
1 - I have read about people stopping paying their debts and storing money for when they become BR. Will the OR/Courts not look at this and take the stored money towards paying my creditors? I think what people tend to do is stop paying creditors to pay their BR fees or deposit for rent, not to stash some money for after BR. That would definitely be frownedupon and yes, claimed for creditors.
2 - When my house is repossessed, if, after mortgage co sells house on, there is a shortfall in equity, can they charge me for it? Provided you write 'possible shortfall' for your mortgage and any secured loans on your SoA in both secured and unsecured sections, then no. In this case, the shortfall would be captured in the bankruptcy.
3 - I recently spoke to my financial advisor, and he said that the OR will usually get my wages paid into their accounts and give me "pocket money" to live off, has anyone had any experience of this?? No, this is not the case at all. The OR will look at your income and expenditure and decide how much disposable income you have left at the end. If you have £99 or less, you will pay nothing, but if you have more, a percentage of that will be taken in an IPA (income payments agreement) for 36 months to be given to your creditors. Aside from that, and the fact your tax for the rest of the financial year is taken for your creditors too, you are left to deal with your money as normal.
4 - Will the courts accept a BR Petition if I have no "nasty" letters from my creditors? Providing you are insolvent (cannot repay your debts and don't have enough assets to sell to repay everything you owe), and you have sought advice, there is no reason for a court to reject your petition.
5 - My Ltd Company has £9k of debts to the taxman, will these be wiped clear too? I'm not sure about this one, sorry, but am sure someone else will advise you on it.


Hope that helps somewhat. Keep asking the questions!

CG. x

kevj1977

RichOneday wrote: »

5 - My Ltd Company has £9k of debts to the taxman, will these be wiped clear too? No, the Ltd company is a separate legal entity

What would happen to my Ltd Co then?? I was under the impression that once BR, I would be made to resign as sole director, and the company be dissolved..
Is this correct?? Or do I need to declare the company BR too??
Just to clarify, I am the sole director of my company, which is due to stop trading as I have found permanent employment..

Also, when "storing" some money to see me through the BR process, what kind of amounts are considered reasonable?

RichOneday_2

Its a separate process, but the company won't just dissolve beacause of the debt. Instead it will need to be liquidated by an IP.

You need to call Business Debtline about this 0800 1976026

deedee_3

kevj1977 wrote: »

Firstly, sorry for posting again, but I am very confused about bankruptcy.

I have read a few posts from people considering and/or going through BR and have a few questions myself.

My first post is here:
http://forums.moneysavingexpert.com/showthread.html?t=1122205
This has my current situation and SOA on it.

Here are my questions:
1 - I have read about people stopping paying their debts and storing money for when they become BR. Will the OR/Courts not look at this and take the stored money towards paying my creditors?
2 - When my house is repossessed, if, after mortgage co sells house on, there is a shortfall in equity, can they charge me for it?
3 - I recently spoke to my financial advisor, and he said that the OR will usually get my wages paid into their accounts and give me "pocket money" to live off, has anyone had any experience of this??
4 - Will the courts accept a BR Petition if I have no "nasty" letters from my creditors?
5 - My Ltd Company has £9k of debts to the taxman, will these be wiped clear too?

Thanks in advance. If I think of any more questions, I will post them.

After reading this I wonder what other mis-information you have been given by your FA. Please talk to Business Debt Line or CCCS business department.

blind-as-a-bat_2

kevj1977 wrote: »

What would happen to my Ltd Co then?? I was under the impression that once BR, I would be made to resign as sole director, and the company be dissolved..
Is this correct?? Or do I need to declare the company BR too??
Just to clarify, I am the sole director of my company, which is due to stop trading as I have found permanent employment..

Also, when "storing" some money to see me through the BR process, what kind of amounts are considered reasonable?

Officialy your not allowed to store any but enough to see you through the aftermath of Br may be "overlooked" ( say a months worth or les)

When BR you are not allowed to be a diretector of a company. If you are the only Director then the OR may shut your company down unless it is in there intreests to let it trade on, but without a director that may complicate that sole traders are easy but ltd companys confuse the issue Sorry but my knowledge is limeted on that score im afraid

But if your OK with that you can talk to your OR about it, they are usually helpfull in most cases, but it wouldnt hurt to find out before if you can

As |deedee points out being given an allowence by thre OR is rubish but they do restrict you surplus income via an IPA if it is deemed apropriate