Bankruptcy... Is it to easy?

louiser123

Broken_hearted wrote: »

Maybe not punish them as such but make it harder to go bankrupt and ban them from certain credit. Meaning they could get credit for a mortgage but not for a holiday or suchlike.
They should also have to prove they have tried everything to avoid it not just phone CCCS or similar once. A lot of people who go bankrupt could have avoided it and most given time could pay the debts back.

anyone who is currently bankrupt not dischared can not get credit in any form, mortgage or otherwise, for 6 years after br even though discharged there is prob a 1% chance of being accepted for credit with a loan shark, so in fact bankrupts have no access to credit for a long time!!

louiser123

also on another note we tried to do an iva (individual voloutary agreement), with our creditors which would mean we payed back a good percent of what we owed them, they actually voted for a no, even though the insolvency practitioner had said if it was not agreed it would mean bankruptcy.they were happy to make us bankrupt rather than enter the agreement, they ended up with far less in the end they sold our debts to dcas for pennies rather than allow us time to pay whay we owed, so these banks and credit places are not whiter than white either!!

Broken_hearted

louiser123 wrote: »

anyone who is currently bankrupt not dischared can not get credit in any form, mortgage or otherwise, for 6 years after br even though discharged there is prob a 1% chance of being accepted for credit with a loan shark, so in fact bankrupts have no access to credit for a long time!!

In this climate possibly, for the first year think its £200 credit which I presume is for things like phone contracts and such. Then after discharge you are free to get as much as you like.

louiser123

Broken_hearted wrote: »

In this climate possibly, for the first year think its £200 credit which I presume is for things like phone contracts and such. Then after discharge you are free to get as much as you like.

yes agreed you may be free to get as much as you like, getting though is a differnet issue, it is nie on possible to obtain a credit card, loan or any other credit like contract phone with br on your credit file.

dad-of-4

Broken_hearted wrote: »

Maybe not punish them as such but make it harder to go bankrupt and ban them from certain credit. Meaning they could get credit for a mortgage but not for a holiday or suchlike.
They should also have to prove they have tried everything to avoid it not just phone CCCS or similar once. A lot of people who go bankrupt could have avoided it and most given time could pay the debts back.

but i don't want a mortgage ever and would very much like a holiday. Surely i should be free to have a holiday & not a house, if that is how i choose to live my life, if someone is prepared to provide a holiday on finance for me.
thats just discrimination, legalized discrimination, what about justice on the level playing field?

what about making it illegal for a bank to provide the finance, they wouldn't want that. so why would I.

proving how they tried to avoid going bankrupt is very subjective.

turn it the other way and add a prove you've done everything you can to recover this debt you are owed and all you end up doing is pleasing some and not others, you just change who's pleased and who's not.

I like many others have been forced into bankruptcy because i couldn't reach an agreement to pay a debt i owed, due to changes in life, that i had no control over.
others might bankrupt themselves but its still often done after begging for more time, a bit of leeway, reduced payments etc etc.

nickmason

I used the word "allow" the OR to punish. I certainly don't think it's appropriate in every instance.
What I was pondering was whether a little more discretion - and possibly more knowledge of the case - would combine well with the threat of punishment, so that the potential bankrupt couldn't "do the maths" and play the system.
I imagine that this would have quite serious legal ramifications.
But it seems to me that if the shame or societal pressure against bankrupcy is no longer present in certain groups, then they are no longer being "judged" by the people as they are in other groups.
To deliberately rack up debts in anticipation of bankrupcy does seem pretty close to criminal.
So my musing was that - just as a criminal court takes the aspects of the case into account when determining sentence - could the bankrupt be judged on the facts of the case, rather than simply play the "get out of jail free" card?

It would of course play both ways - such a process would have the ability to recognise genuine mitigating circumstances.

The broad brush seems not to be working at the moment.

mewbie_2

Of course if you are a Sir, it is quite reasonable to allow one of your companies to go 'bankrupt' ie, into administration, and then use another of your companies to buy it, while stuffing all the creditors. We save all our anger for little people with their few thousands here and there, and don't notice the really big scams perpetrated by those higher up the food chain.

http://www.telegraph.co.uk/finance/4028418/USC-in-administration-Sir-Tom-Hunter-buys-43-stores.html

nickmason

dad-of-4 wrote: »

proving how they tried to avoid going bankrupt is very subjective.

I do recognise that the question of subjectivity is very thorny. But it is not as if we don't have that problem in so much - criminal law and so on.
That was the other reason why I suggested a local community perspective, as a way of taking understanding into the process. As I say, haven't really thought it all through, but was simply pondering.

Still quite intrigued by the thought of bringing family back into the process, possibly through means-testing family support before granting these allowances. Might "internalise the externality" as economists would say.

nickmason

mewbie wrote: »

Of course if you are a Sir, it is quite reasonable to allow one of your companies to go 'bankrupt' ie, into administration, and then use another of your companies to buy it, while stuffing all the creditors. We save all our anger for little people with their few thousands here and there, and don't notice the really big scams perpetrated by those higher up the food chain.

http://www.telegraph.co.uk/finance/4028418/USC-in-administration-Sir-Tom-Hunter-buys-43-stores.html

I agree - utterly despicable.Although it appears that he has taken a pretty huge hit in the transaction. What's odd (and I know nothing like enough about the processes of administration) is that these deals get closed, apparently without the pre-pack going out to the open market. Or is that just how the media are reporting it?

piggeh

If the OR believes that the bankruptee has deliverately built up debts to 'play the system' they can impose BROs on them and probably other conditions (havent read BR stuff in a few years now). The only weakness in BR is that ORs do not always look into matters as well as they should.

Really we should all pay a little more tax so these ORs are a bit more well resourced and able to look into cases more fully because at the end of the day that is really the only way to sort out the abusers from the 'innocent' - but then we should also pay more to pretty much every area of Government as they could all do things a little better with additional resources!