Direct Payment bank account & bankruptcy

isabella01

Hi all
I am realively new on here but already getting lots of support,advice and reassuring info.
Our eldest son(12) has complex special needs(high rate DLA care,low rate mobility) we have a Direct Payment for care and respite for him,as he's a child it is paid into an account in my name.
We have had such bother with our bank and due to a failed attempt at self employed business we are now in debt we cannot deal with..after consultation with a money advisor this week it has been reccomended we go down the route of Low Income Low Assets(LILA) self sequestration(bakruptcy)...our current bank where the DP's account is held is our largest creditor and we've been advised to set up another account for our benefits(inc our son's DLA)..easier said than done..we are in a small town we could open a post office account for the DP's but a requirement of the DP's account,I believe,is a cheque book for finanvcial record and the P.O. don't do cheque books.
I have sent an email to my local Direct Payment agency to see if they can assist..but surely even when we are declared sequestrated(bankrupt) the current account for Direct Payments cant be frozen..or can it?..it's not our money it is for care and respite costs.
Has anyone any experience or have a clue what we should do..
thanks in advance for any help...
Izzy

somebody_else

Sorry about your problems, isabella.

I'm afraid I can't help with the legal aspects of the situation (might it be worth a trip to your nearest CAB to see if they can answer the question?), but I can make a suggestion regarding the bank account.

I was also advised by CAB to open up a new account, to stop my bank from taking money out of my benefits when I was approaching a similar situation. Now, I realise that I am lucky in that I live in a city so have access to all the major banks, but I don't get out very often so might as well live in a small town/village. The simplest solution to the problem of changing banks and needing a cheque book is to open an account with a bank that does cheque books and that offer internet banking from the same account. In my case that turned out to be the halifax, but the point is that I went into the branch to open up the account (1 trip) then once I'd got the paperwork just about everything else is done via the 'net. As you'll only be using it for your son's direct payments/benefit payments that would solve the problem, wouldn't it?

daska

There are internet only bank accounts where you don't even have to go into a branch to apply e.g. Intelligent Finance (Halifax), Cahoot (Abbey National) and First Direct (Midland). That should widen your choices.

isabella01

Thank you:T both...it may be worth looking for a branch of Halifax nearby..Co-Op has also been suggested but our closest is 50 odd miles away...but I get your point that once the account is open I'll not need to go to the branch.
daska..interesting we haven't yet embarked upon our self sequestration route and have a good credit rating for a limited period only:o ..but the concern is that the new bank might freeze or close the account once we are officially declared bankrupt?

Our local CAB sadly was as much good as a chocolate fire guard:rolleyes: when we dealt with them about our debts a few weeks ago..we were lucky to get reffered to a local debt advisor through National Debtline who came to our home:D

cheers :beer:
Izzy

daska

I think I'd make it clear in writing when you open the new a/c, whoever it's with, that it is for the sole purpose of your care payments - provide them with documentation to prove this. If there's then a problem you can remind them that it's not your money in there. TBH if they didn't unfreeze it immediately I'd ring Social Services, all the benefit providers and my MP that same day.

longhotbath

Hi - I was advised to set a seperate bank account for my sons direct payments in a different bank to the one I normally use.
I chose the halifax, have cheque book, direct debit card, one statement a month, and do everything else online. Once you have set it up, you dont need to go into the branch again.
Good luck.

isabella01

I'm on the case..looking at banks in the next town to us..small town small minded folk am affraid..when we leave the bank we're in there is only one other option and a relative and a friend work there!
thanks

allydowd

If you get an account with some banks you can use the post office as a 'bank'. ie you can pay in and take out money from some bank accounts for free at the post office. This link shows you which ones:

Post Office link

isabella01

The problem is the admin..it needs to be a cheque account I cannot draw cash..there needs to be a paper recors of all transactions.
I have been advised to leave the account where it is..that even once we have been declared bankrupt the bank cannot..or at least should not touch this account..
thanks all for your help...