The Right Decision?

DecisionTime

We've pretty much decided to go BR, but just want to see if anyone has any ideas about another way out.

Following various business problems over a number of years, and propping up the finance by using the equity in our house and racking up credit cards and loans, we have the following elements in my situation:

• OH and I ceased trading our business partnership as our income was increasingly exceeded by all our debts and liabilities. Also the bank pulled our business overdraft and we have nothing to pay them back with or hope of doing so in the forseeable future, given our other circumstances. We have seen much better times, but all that has changed.
• Both in our late 50s
• Now both employed with a joint monthy income (after tax) of around £3k, which will just about cover our outgoings within an anticipated IPA
• House on an interest-only mortgage of £425k, now in negative equity of around £35k and increasing and has been costing us £2.4k a month. Value has dropped over 20% from peak and wiped out the equity. Take years to recover. We'll never own it, just 'renting' it from the bank at way over a commercial rental rate.
• Planning to give the house back as a voluntary repo - have moved into rental property and saving over £1k. (Very upsetting to have to lose a long-time family home)
• Unsecured creditors around £160k
• Been on a DMP for about 4yrs but the total cost of the mortagage, and paying the creditors (who gradually edged up the repayments and not willing to consider any reductions or payment holidays) and the car lease, was leaving us short of over £3k/mth. (Car will shortly be reposessed).
• Have now stopped paying everybody - can't anyway. Currently not taking phonecalls or answering letters - seems that's the advice people give on here.
• Planning to go BR early April bfore the creditors get into legal action

Given the state of the world, I think we're fortunate to be employed at the moment - even moreso, given our age. Hope it'll hold up during the recession. Can't see our financial position improving much for years the way things are in the world.

So, having looked at various information here and elsewhere, BR seems to be the most appropriate course of action. Hope we can create some kind of 'fresh start' - at least without the debt burden and creditors hanging over our heads. Not looking forward to the restrictions of an inevitable IPA and future discharged-BR status though.

Unless anyone can come up with a better plan, of course. (Not the Lottery, please!) Thanks for any advice you may have for us.

I hope we don't offend anyone who might feel that because we were once comparatively well off we don't deserve much sympathy, which I say beacuse I have seen a few comments like that (although maybe not here).

tigerfeet2006

No one will judge you on here or be offended. We have all come here with different histories but have all found ourselves in the same position.

Looking at the infomation you have provided I would say BR is definatly your best option. I wouldn't go for an IVA with no house to protect an dno assetts.

Have you taken advive from one of the debt charities about this. Links and no.'s in my sig and more in the Bankruptcy Help sticky (this is a must read sticky with lots of helpful info.)

Pop up you SoA's and we can check them for you and make sure you haven't forgotten anything. You do know if you are both going BR you have to do individual SoA's?

Welcome to the board.

JCS1

As Tigerfeet has said, do make sure you've taken advice.

Also, with you being in a partnership until recently, suspect you may have an office interview rather than telephone, but that is standard for business debts.

Bethankim

Hiya,

welcome and you have found the right place, i am still very new here and not quite confident or knowledgeable yet about all the ins and outs..i shall learn though because i plan to give back as much as i have received.

BR does seem to be your best option and once you have made the decision, and worked out your SOA it will get better.

The court will want to know you have taken advice, it may take you a while to get through to the help lines but keep trying.

everyone here has their own story, and no one judges.

DecisionTime

I was under the impression that we did a joint SOA not separate ones. We've been told by the Insolvency Service that as we are both going BR along with our business partnership that the whole thing would be dealt with as a single case, and for a combined single fee. Are you telling me something different?

tigerfeet2006 wrote: »

No one will judge you on here or be offended. We have all come here with different histories but have all found ourselves in the same position.

Looking at the infomation you have provided I would say BR is definatly your best option. I wouldn't go for an IVA with no house to protect an dno assetts.

Have you taken advive from one of the debt charities about this. Links and no.'s in my sig and more in the Bankruptcy Help sticky (this is a must read sticky with lots of helpful info.)

Pop up you SoA's and we can check them for you and make sure you haven't forgotten anything. You do know if you are both going BR you have to do individual SoA's?

Welcome to the board.

EnslavedByDebts

From all the threads i have read over the last few months then i am sure that you will have to file for bankruptcy as individuals and will both have separate cases. This will include a fee for £495 for you and a second fee of £495.00 for you wife.

I am sure someone with more knowledge will correct me if i wrong but that is what i get from all the reading i have done.

EBD

headoutofsand

DecisionTime wrote: »

I was under the impression that we did a joint SOA not separate ones. We've been told by the Insolvency Service that as we are both going BR along with our business partnership that the whole thing would be dealt with as a single case, and for a combined single fee. Are you telling me something different?

It may be that the business will be dealt as one case, but each of you will have to file separately, which would make sense. I may be wrong though.

JCS1

It's very rare (I only saw one case), but their is a joint form for partnerships, but I think the whole debt has to be joint, so if one of you has a credit card in a sole name the it can't be done.

Let me see if I can find anything on the internet,

JCS1

Found this, section xv and xvi seem appropriate.

http://www.insolvency.gov.uk/freedomofinformation/technical/casehelpmanual/P/Partnerships.htm

nervousmother

Welcome to the board,
You will have to pay two lots of fees one for you and one for partner, The business will be dealt with within those fees. The only time a business is dealt with on its own is when its a ltd company.
As long as you have taken proffessional advice you will be ok, reading your situation I would agree it does seem the best course of action for you.

Both me and OH went BR, we were asked to do a joint SOA. We have not had a IPA yet but im sure it will come, Dont forget if you do not agree with the ipa you can argue.
It is almost certain you will get a face to face interview purly down to your business, you may have more than one but dont worry just have your facts straight.
good luck to you in the future

Lensman_2

Hi Decisiontime.

Welcome to the forum. It is remarkable in an internet forum for the lack of judgement and condemnation you get from the other members. Thanks Tigerfeet for your comments too.

My thoughts on any alternatives for you is that they must be done and dusted by the time you retire. The size of your debt and the amount of income makes it impossible for that to happen if you have to pay the whole lot off.

I am only 47 but the state of my finances at retirement has figured quite highly in my decisions about my own situation.

All the best to you.

LM