Ask a CCCS counsellor a bankruptcy question

CCCS_Amanda

Ethereal_Gaz wrote: »

Hi, I'm a mechanical engineer and was told a few weeks ago that my contract is ending next week. I've been looking for work since but there's nothing about.

I owe £18k across 2 visa cards and am probably just about dipping into negative equity on our flat with the current mortgage of £120k. I will also owe around 7k to HMRC.

My wife looks after our daughter so manages to work 2 days a week.
I figure I can manage to be out of work for 2 weeks before things get difficult. What happens then?

Also, is there anything I should be doing now, before I get to that stage, which could help later? Should I pre-book a CCCS call now or wait until I'm out of work?

Thanks

Hi Ethereal_Gaz,

Thank you for your message.

If you are going to have a reduction in income then you need to do a few things:

• Maximise your income. When your income reduced you will be entitled to benefits (JSA, Income Based JSA, Support for Mortgage Interest, etc.).
• Before your income reduced try to cut down your expenditure to the bare minimum. Cancelling SKY packages, reducing telephone costs, reducing insurance costs if possible, downsizing vehicles, etc.
• Prioritise your expenditure. Your main priorities are always the things that will affect your health and wellbeing if they are not paid. Your mortgage, council tax, gas, electric, food, travel, etc are always a priority. Unsecured personal lending is usually a NON-priority debt: loans, credit cards, store cards, catalogues, etc.
• Talk to your secured lender if you foresee problems meeting your mortgage payment. They may be able to reduce your payment by putting you on an interest only loan temporarily.
• Put an honest budget together. Find out what you need to live on. Limit the things on your budget to your essential expenditure that way you will know what you need to have coming into the house.

Once you have done these things hopefully you will be able to make ends meet for the short time before you can return to work.

It’s difficult to give you detailed advice via email as we don’t have your full financial details. However you can visit our online debt advice facility called Debt Remedy.

Debt Remedy would assist you in completing a financial statement and you would be provided with tailored advice on the best way to deal with your situation. Click here to go directly to Debt Remedy.

If you would prefer to talk to a debt counsellor about your situation and the benefits that you will be entitled to, you can book a telephone based appointment by calling our helpline free on 0800 138 1111. Lines are open Monday to Friday 08:00-20:00. It would be helpful that when you call you have details ready regarding your income, expenditure and creditors, as this can help speed up the referral process. If you have this information ready it may be possible to refer you directly to a counsellor if one is available, otherwise we will arrange a time that is convenient for you to be called back for an appointment.

Regards,
CCCS

Itsallgonepearshaped

Hi,

Just had a solicitors letter on behalf of one of my creditors as a formal demand . If they don't receive the outstanding sum in 7 days they will be issuing a statutory demand "being the first step in Bankruptcy proceedings". Do you think this means they're going to bypass the CCJ and go straight for BR? Is there any difference between petitioning for your own BR and a creditor doing it (I assume I'd save the fees for starters?)

Thanks

notmyrealmoniker

Hi,

Ive been in an IVA for two years now but have just lost my job so have no way to continue paying. Before I ring the IVA company can anyone give me some advice, i am considering becoming bankrupt or letting my creditors bankrupt me as finding the fee will be hard. I rent a room in my parents house and my real worry is that my parents will be involved with bailiffs? I dont own a house and dont have much in the way of belongings, my debt when i began the IVA was around £18K. any advice would be most welcome.

Thanks

peachyprice

Hi there,
It's highly unlikely that any of your creditors will make you bankrupt, you have no assets (probably shouldn't have been enouraged into an IVA in the first place) so they'll get nothing if they do. The only exceptions are HMRC or Amex. Do check your IVA paperwork though, some do make provisions to pay bankruptcy fees if the IVA fails.

There are no bailiffs involved in bankruptcy, no-one will come to your home or take any of your stuff, but you will get letters from the Insolvency Service, depending on which area you live these may or may not have 'Insolvency Service' on the oustide.

Depending on how long you've been in the IVA it's likely your debts are still the same as when you stared, the initial payments go towards the £1000's of IP fees.

HTH

baastet

Hi,
My mother died last year & I have just had a letter from the sols dealing with the will saying that they have done a bankrupcy search on me & have discovered the following: PA(B) from 2007. This related to a threatened bankruptcy action for my flat which was repossessed about 14 years ago & had 27,000 negative equity. At the time I was only working part time (still am) & have 2 disabled sons. The sols who originally applied for the bankruptcy have accepted that I pay the debt off 25 pounds a month which I have been doing.
The sols acting for my mother's estate have asked me to sign a declaration saying that the entry does not apply to me before they will let me have my inheritance. I am really scared & have no idea what to do - i assumed that because I had made an arrangement with them that they would not have any claim on my money. I have been penniless for so long & this was my chance to leave something to my kids when I die - please can you give me some advice?
Thank you

CCCS_Matthew

markw5 wrote: »

I have been contacted by a debt councillor (?) working on behalf of my landlord. She has asked me to put my landlords name on the utility bills of the flat I rent along with an entry on the electoral roll. This is to prove she lives here but I have been verbally assured that she only needs to do this due to the bankruptcy. I think she is also getting divorced. The councillor ("Debit Doctor?) told me that this is legal but I am afraid that we are being drawn into something that maybe on the very edge of legal (MP's expenses etc.) and may rebound on us in the future.
We have no debits etc but do not want to be blacklisted if, in the future, it is decided that we have deceived the court by allowing her name on these documents.
Any ideas if this is normal practice and is it legal.
Thanks

This seems very strange to me.

Have you asked why your landlord has been asked to do this? From what you've mentioned it seems as though perhaps your landlord is trying to show they are living in the property rather than living elsewhere. Why they would want to do this is beyond me. I don't know whether this would be classed as illegal, it would certainly have an impact should you need to claim benefits at any stage.

The other concern that springs to mind is that if your landlord is considering bankruptcy, they will asked to surrender assets within the bankruptcy. If he has equity in the property you live in, this could be at risk. You really need to speak to your landlord and find out their intentions.

Matthew.

CCCS_Matthew

scorpiocat wrote: »

I am a discharged bankrupt, (went BR in mid 2005) and a year over the point when I no longer have to let anyone know about any changes in income. I believe it may still be a while before I can get a debit card in the general run of things.

However, within the next few weeks I am due to inherit a reasonable amount of money from the estate of my mother. While I wish to invest a large portion of it, I will need to be able to access the rest of the money for general expenditure. Is there any bank likely to give me at least a debit card if I bank with them? If this is unlikely, or even impossible, would I be able to be put as a secondary card holder on an account in my partner's name? I'm not trying to be deceptive, or commit any kind of fraud, just want to be able to access what is or will be mine.

Hope you can give me some ideas on this. Also hope I've managed to post this query in the right way/place. Please accept my apologies if I've done it wrong.

Thanks.

Hi there.

Your bankruptcy will still be on your credit file, so this may have an impact on opening a new current account as you would normally be credit checked. However whether this would prevent you from opening an account would be based on the discretion of the bank, so it's hard for me to give you a definitive answer about what the banks will say. My advice would be to perhaps approach a couple of banks and see what their policy is. You might also want to make a new thread elsewhere as you are more likely to get a response from someone else that's been in a similar situation to yourself.

If all else fails, you could see whether you could be added as a joint name in your partners account, there is certainly nothing wrong doing this.

Regards,
Matthew.

wordsfan

Hi

Hope YOU can help.

I live in scotland. Have debts of up to £15,500 (some agencies may be chasing the same debt, my advisor from citizens advice is checking into this for me) from being a student. My advisor has recommended bankruptcy (if i ever manage to save the £100 fee!)

Have a savings account and a current account with Bank of Scotland opened in 2006. My major creditor is lloydstsb who now own HBOS!!

I was working until 18 mths ago and starting to pay off debts. However now unwell and on benefits unable to work.

I was turned down for basic Co-op account in 2007 while still working on basis of credit search, despite many on here saying it hadn't been a problem for them. I also recently applied to RBS and was refused for same reason.

I am nervous of citibank as only heard of them on here and don't know anyone with an account with them. Credit unions seem to do same credit checks for current accounts and also it seems you have to be a savings member for a while before opening current account but i need this sorted asap as my best option is to go bankrupt.

I enquired today at Clydesdale bank re their basic account. perhaps i was too honest but said i had poor credit and may soon be going bankrupt and they said no way would i even get a basic account with them.

I'm terrified if i go bankrupt, my bank will close my account and i'll be stuck with nowhere for my benefits to be paid into and also i really need to be able to pay certain bills by direct debit as thats saving me money on those bills and i really can't afford to pay them any other way!

Beginning to feel very anxious and desperate. Can you advise? even according to FSA leaflet only accounts that will take you if you are BR are co-op - which I've already been turned down for! and Barclays, which i THINK i had overdraft with them over a decade ago which eventually got paid off but doubt they'd be my biggest fans!!

anyway as you're an expert I'm REALLY hoping you can help.

Many thanks
WF

CCCS_Matthew

David_Is_Right wrote: »

Hi there,

Firstly, this is a great service that appears to be really helping people, so well done to all involved.

I'm hoping someone may be able to answer a quick question for me, please?

I am looking to go bankrupt in the next few weeks due to business debts. In the meantime I have got another job, which pays £24,000 a year. My question is, will a restriction be placed on this salary? If so, is there any way to avoid this?

I am living with my partner (unmarried without children) and renting a one bedroom flat. At present, she is unemployed but not claiming benefits.

Thank you very much in advance,

David

Hi David, thanks for getting in touch.

When you say a restriction, I'm assuming you are referring to an Income Payment Arrangement (i.e where the Official Reciever encourages you to pay a proportion of your surplus to the creditors for up to 3 years)?

If so, it's not based on your actual salary, it's based on what you've got left at the end of the month after you've paid out all of. So without seeing a list of your income and outgoings it's impossible to say. For your reference, an IPA is usually 50-70% of anything over £99 that you have spare at the end of the month.

Once you start to fill out your forms, you should start to get an idea whether there is anything left.

Regards,
Matthew.

wordsfan

Hi Matthew,

I'm also wondering if fact I am not on electoral roll and have no passport or driving licence for ID is whats causing me problems? Also only been at this address for 20 months. previous address for a year and address before that 2.5 years.

thanks