Questions on BR

Badger_Badger

Hi,

First post!

Got a bit of a situation and am looking for advice.

Got into a relationship with someone a few years ago and had children, bought a house together, relationship turned sour and broke down, went to court to try force a sale of the house but failed. This is the vital bit - court transferred my 50% share of the house to my ex for the next 10 years when our daughter turns 18.

Decided to setup my own business but as I don't have any assets got a small business loan under the small firm loan guarantee scheme. That money ran out after a while so financed the business on CC's & personal loans.

Solicitors from the court case took me to court and won a CCJ as I couldn't afford to pay their fees. Paid £20 per month for 2 years

Fast forward to present day...........

Got about £20k in unsecured debt - CC's, personal loans. Been on a debt management plan with the CCCS for about 3 years.
Solicitors from the case weren't happy with the £20 and successfully got an order stating that I must pay in full, approx. £5k. I simply don't have this amount of money and wont for the next 9 months or so.

So realistically my only option is bankruptcy

Questions:

1. Will the OR take the house; I have a court order stating that my share belongs to my ex for the foreseeable future i.e. until they turn 18
2. What will happen to the business? I'm no longer a director as my new partner is, although I'm still on the business account. Business also has a £10K overdraft which is in use.
3. Will the bankruptcy process stop the bailiffs coming round which is bound to happen once I tell the solicitors that I can't pay them. Not that I've got anything of value.


Thanks in advance

BB

headoutofsand

Hi and welcome. Don'T panic. Others will be along to answer your questions when they can.
Don't tell the solicitors anything. I had no house so can't answer but someone will. I am pleased to say this place is a good place, full of very experienced people. Creditors are the last people you should inform about possible BR.

peachyprice

Hi Badger, welcome to the forum.

Firstly is there any equity in the house? If there isn't the OR won't touch the house at all.

If there is there are different ways the OR can deal with it, as you say it's be signed over to your ex until the children are 18, the OR could put a charging order on the house to say once the house is eventually sold he will get your share of the equity at todays value.

Bankruptcy overrules overything, so no more bailiffs from the CCJ's.

HTH

Badger_Badger

Hi, There's possibly some equity in the house, maybe 30k-40K. Obviously I don't want to see my children on the street so a charging order would be best....fingers crossed. Can anyone answer the question about the business. Thanks for the responses so far!

Rebe

Hi, hope the following help..
when you're declared bankcrupt, the will seize any assets you have so the your business is a big asset so that will go, and if you're on an account, that will be frozen and out of action, so before claiming BR, get names off of accounts.
Like Headsoutofsand said, don't tell your creditors anything, once you're declared BR, they can't touch you and bailiffs wont get involved.

Do you have a good relationship with you business partner and does he/she know your current situation/plans for BR?

Rebe

peachyprice

Badger, it the business a limited company? I'm guessing it is. If this is the case and you are no longer a director I don't beleive your own personal bankruptcy will have any effect on the business, but you will have to remove your name from the business account.

jenni75

I dont think you will be able to remove your name from a account that has borrowing on it. The overdraft will have to either be repaid to enable you to be removed.

or your other option is that you will be able to put the overdraft into the br. However if your partner is on this account with you then the whole debt will fall to them.

You will not be able to be on a bank account with overdraft facilities once br. Co op bank are br friendly and I believe that they often turn a blind eye to businesses being run through their accounts.

jenni75

Peachy I agree with what you have said there, but neither of us were able to remove our names from the business account when we still had a overdraft on it. Would this not apply when its a ltd company?

Badger_Badger

Rebe wrote: »

Do you have a good relationship with you business partner and does he/she know your current situation/plans for BR?

Yes, it's my wife! She's the sole director in the business and she's more than aware of the situation. I haven't been a director for about 2 years now.

However if your partner is on this account with you then the whole debt will fall to them.

What does this mean? That she'll be responsible for the debt if the business goes wrong? If so then that's not so much of an issue as she doesn't have any assets either as we rent our home.

Rebe

In that case, the situation is made easier.
If you can get yourself removed of the account, do so or it will end up being out of action and penalise both your wife and the company. Would the company be able to continue as normal if you tied the overdraft on the business into the bankcruptcy in order to get rid of that debt also?

Rebe

What Jenni75 meant with debt falling onto your wife is that, because it's a joint account and you decide to claim BR, because your wife is the other holder, they will pass the debt to her to pay off (as she's not the one claiming BR and they can still claim the repayments from her because she is on account to) hope this makes sense