Bankruptcy advice needed please...!

hudleys

My OH and I are seriously considering going bankrupt - this month for the first time we have finally run out of credit to live on. We have looked into DMP's and IVA's and basically dont have enough income between us to try this route. We owe £32000 between us in unsecured debt with no assets to speak of.

We have been offered a place to live with one of our parents but this would mean having to give up our jobs if we do have to go bankrupt even if they let us stay (legal and civil service jobs). How is this viewed by an OR if we were to go bankrupt and give up our jobs to move 250 miles away to live in initially rent free accommodation?

Also with regards to our mortgage we are not yet in arrears however we have arranged a smaller payment for the next 3 months. Should we be in arrears with our mortgage before we apply for bankruptcy - it is something that we would need to include as we have a Northern Rock mortgage (already in negative equity - £149000 - house now worth £130000) plus a 1st Plus loan for £50000.

I am at a loss as to how to proceed. We are going to try to get in touch with the local CAB etc but just wondered if anyone could give us some advice.

Many thanks!

dvs

Welcome to the forums. First of all, you do need to get advice. It's a big decision to go bankrupt so best you speak to the CAB or one of the debt charities as soon as you can.

You need to stop paying all non essential bills like credit cards and loans. No point in borrowing more to make payments to these. As you say, you've run out of credit anyway.

You do not need to be in arrears with anything (including mortgage) to go bankrupt. You just need to be insolvent (outgoings more than your income). Not sure whether you plan to keep your home if you can? As I understand it, your home is worth £130,000 but you have £199,000 secured against it. If you are going bankrupt, it might be best to walk away (but that's your decision).

The OR will not have a problem with you giving up your jobs if you need to - either because your contract would be terminated due to bankruptcy or because you were moving out of the area because of financial reasons (i.e. you're moving to live in a cheaper place such as your parents). Giving up your job is a big decision though especially in the current economic climate. You might want to find out if you really would lose your job. If you can't speak to anyone at work, check out the terms of your employment.

There are loads of people with real-life experience of bankruptcy here (myself included) so feel free to ask away but you do really need to get professional advice too. We'll guide you through the rest.

hudleys

Hi dvs - thanks so much for your advice. Things have just come to a head over the past couple of days and feel like we just cant carry on borrowing to try to repay debt as we have been doing over the past few years.

I think we need to make a fresh start as however we try to work it out there seems no other way out than bankruptcy. Thanks for the advice - we will get some professional advice but it's so reassuring that others have been through the same nightmare and have 'come out the other side'.

Will let you know how we get on - cheers - it's much appreciated. It's a relief to have finally admitted to ourselves the mess that we are in.

tigerfeet2006

There is a list of debt charities in the Bankruptcy Help sticky and some in my sig. Be aware they are all very busy at the moment and we are getting reports of people waiting half an hour to get through with their finger on redial.

Have a read of the Bankruptcy Help sticky and some of the threads and ask anything you need, we will try and help and support you all we can.

dvs

hudleys wrote: »

It's a relief to have finally admitted to ourselves the mess that we are in.

The first step and probably one of the hardest. I managed to survive for years through continual borrowing. It all came to a head last year when the credit dried up. I had to make the decision whether bankruptcy was the right thing for me. Once I had made that decision, everything else started to fall into place. One step at a time.

Make sure you keep posting as and when you need help. Good luck!