Ask a CCCS counsellor a bankruptcy question

CommitedToChange

hi
I have a quick question. Since I am a freelancer with no fixed income (varies from month to month) am I correct in thinking that my only option on 30k of debt is bankruptcy?

I read that you can only do an IVA if you have a guaranteed amount coming in. - I'm currently considering my options.

Thanks

CCCS_Sue

bankrptct_beckoning wrote: »

Dear Pavan,

Thank you for answering my questions. Could you possibly help me further by answering a couple more questions? Our BTL is currently empty and has been for 5 months and would like to keep it so for the forseeable future due to an unpleasant experience between my last tenant and the flats above and below. Luckily, the mortgage payments are low at the moment. Would it be more or less likely my wife could buy the beneficial interest if it continues to remain empty and earns no income?

My final question, if you wouldn't mind, is, can i get proper surveyors to value the properties and arrange the sale of the beneficial interest to my wife for both properties, before going bankrupt? Would there be any complications with the OR as long as the sales weren't below market values. Pretty confident not much, if any, equity in the house and definately not in flat. If there is any in the house it will only be due to having a conservatory built, completely out of my wife's own funds. If there is no equity will a transfer for £1 be accepted? I know can do this during bankruptcy but wife would be lot happier if arranged before.

Many thanks.

Hi again

The Official Receiver will question why your BTL property is empty and not being let.

Normally, if there is little or no equity, then a joint owner could look at buying your beneficial interest.

If your wife wishes to look at buying your beneficial interest, then she needs to contact your official receiver.

The official receiver will also decide which form of valuation is appropriate on a case by case basis.

The OR has to ensure that there is a professional valuation of the house, unless a recent independent valuation has been obtained and they are satisfied that it is accurate.

Ultimately, the answer to both your questions is that it is down to the OR who is dealing with your bankruptcy.

I would also recommend that you seek legal advice.

I have attached a link to ‘Community Legal Advice’

They give free confidential advice and may be able to help you further.

http://www.communitylegaladvice.org.uk/

Regards
Sue

CCCS_Sue

simonl79 wrote: »

Hoping someone can help my girlfriend with some debt advice.
She has a joint morgage with an ex partner that is about 35k negative equity. They both ran up lots of debt about 14k but it all went in her name as he was not working and bullied her into it.
He still lives in the house and pays the mortgage but can not get it transfered to his name as he doesnt qualify to have the mortgage on his own and cant get his parents on the mortgage due to their age. Question is, if she goes bankrupt which is her best option does the house get taken into account? Or if she got an IVA does the same apply. He is still applying for credit and as they are linked it shows on her credit report. She has defaulted on her debts and is in payment plans but they will only last so long.
We have a child on the way and the stress is no good for her at all so we aer really frustrated trying to find a way out for her.
Please advise

Hi and thank you for your message

Without knowing her full financial situation, it is difficult to give her detailed advice.

Going bankrupt is a big step to take and requires expert advice. If she is considering making herself bankrupt, she can use our online debt counselling service, which will provide her with the most appropriate solution to her debt problem. Alternatively, she can contact our free Helpline on 0800 138 1111.

The OR looks at any assets he can sell to raise money to pay off her debts.

If there is negative equity in the property, then the OR would not be able to raise any money from the sale or from her share of the beneficial interest at the moment. However the OR does have up to three years to realise any equity if the house value was to increase within this time.

I have attached a link to a booklet from the Insolvency Service which gives further information on possible options and what happens to your home in bankruptcy.
http://www.insolvency.gov.uk/pdfs/guidanceleafletspdf/home.pdf

As her situation is complicated due to the fact her ex is still living there and paying the mortgage, it may be advisable to get some legal advice if she does decide that bankruptcy is her best option.

I have attached a link to Community Legal Advice

They give free confidential advice and may be able to help her further.
http://www.communitylegaladvice.org.uk/


Kind Regards

Sue

CCCS_Sue

CommitedToChange wrote: »

hi
I have a quick question. Since I am a freelancer with no fixed income (varies from month to month) am I correct in thinking that my only option on 30k of debt is bankruptcy?

I read that you can only do an IVA if you have a guaranteed amount coming in. - I'm currently considering my options.

Thanks

Hi committedtochange and thanks for your message.

Without knowing your full financial situation, I am not able to say whether bankruptcy would be your best option.

An IVA is a legally binding arrangement between you and your creditors.
You would need to be sure that you could meet the monthly repayments for the five year term of the IVA.

In order for us to be able to provide you with advice on your financial situation you can either use our online advice facility Debt Remedy, or ring our free Helpline to book a telephone appointment with a counsellor.

Debt Remedy will assist you in completing a financial statement which includes information on your household, employment, income, expenditure and debts. All this information is used as a basis to determine the options available to you to deal with your situation.

Once you’ve followed the process through and completed all the required information you will immediately be presented with an advice booklet, which will provide tailored advice for you based on your current circumstances. It will also provide advice on ways you may be able to improve your situation. If you would like to get immediate advice on your situation, follow the link to go directly to Debt Remedy: http://www.cccs.co.uk/ref/drcu

Alternatively if you would prefer to talk to a debt counsellor about your situation, 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.

Kind Regards,

Sue

lynneworrier

I declared BR in Feb 2010. I have my home, a house my daughter lives in & pays the mortgage on (mortgage is in my name) and 2 other buy to let properties. All properties are in negative equity.
An IP took over the case for the rental income on the 2 buy to lets. I have asked the IP if my daughter can buy the BI on both my home & the house she lives in. My only answer from him is that the "contents of my email are duly noted". I have no communication with him other than the occasional question he asks and is very reluctant to impart anything that goes on. He wanted me to sign an order to pay £60 pm for the next 2 years to cover "his expenses" even though I have no spare income and he has at least £450 per month rental income from the buy to let properties.
Is it usual not to hear anything or not to know whats going on with the home? I don't know who to ask as the official advice is that properties owned by the debtor which directly affect the family of the debtor should be dealt with in a swift manner if there is an offer to buy the BI, so as not to cause any distress.

xxrobzyxx

Hi,
This is my first post on here and i would really like some advice.
Me and my boyfriend are living in a privatly rented flat. He's 22 and i'm 21. Both of us have individual debt mine are about £5000 roughly and his are at least £9000. He is currently on a debt management plan paying £18 per week but they only cover his major debt and even then the company are taking about 5% for themselves. He has just recieved paperwork from the courts as one of his creditors has taken him to court and he just seems to have more and more people coming forward for money. He only works part time and even then his bank takes most of his wages for their charges because he has used the unplanned overdraft (not his choice to go into it they wont take it off his account and they keep taking charges which puts him in it that earns more charges) so he cant afford to pay much and the debt management company have told him he needs to pay more to add more debts which i dont think is fair as they know the situation. he has sent the creditors e-mails offering £5 and £10 per month but i dont know if he will be able to keep it up as money is always tight in our house.

As for myself i am paying all of the bills and only have about £50 per month to spend on food and no money to pay towards my debt. I tried going with the same debt management plan as my boyfriend but they told me it was going to cost me £80 per month which i cant afford. they also took £250 set up fee and then told me i couldnt have it back when i found i was unable to pay them. So right now none of my creditors are getting any money what so ever and i am now worrying that they will take me to court. I have been relying on payday loans to keep me going when i need extra cash and have to use them every month just to keep going. I do have a well paid job i get £937 per month but after bills its nearly all gone. And everyone I have tried to get help from has told me I earn too much money to qualify.

I feel so depressed all the time and I am always in tears because I dont have any money or a life. We have both considered going bankrupt but cant afford the court costs and it will take forever to save up.

Please somebody help me. I'm only 21 and i dont want to be in this situation anymore. I want to settle down and start a family but dont want to bring a child into this povety we live in. Everything is the cheapest i can get (Tesco's own brand of everything).

P.S sorry for the essay

StepChange_Pavan

lynneworrier wrote: »

I declared BR in Feb 2010. I have my home, a house my daughter lives in & pays the mortgage on (mortgage is in my name) and 2 other buy to let properties. All properties are in negative equity.
An IP took over the case for the rental income on the 2 buy to lets. I have asked the IP if my daughter can buy the BI on both my home & the house she lives in. My only answer from him is that the "contents of my email are duly noted". I have no communication with him other than the occasional question he asks and is very reluctant to impart anything that goes on. He wanted me to sign an order to pay £60 pm for the next 2 years to cover "his expenses" even though I have no spare income and he has at least £450 per month rental income from the buy to let properties.
Is it usual not to hear anything or not to know whats going on with the home? I don't know who to ask as the official advice is that properties owned by the debtor which directly affect the family of the debtor should be dealt with in a swift manner if there is an offer to buy the BI, so as not to cause any distress.

Hi Lynneworrier and thanks for your post.

The IP has a duty to follow certain ethical guidelines and provide a ‘fair, efficient, courteous and helpful service’. It doesn’t sound like your IP is providing such a service to you so I’d recommend that you follow their complaints procedure. I have attached links to two booklets which give you more information on how to do this:
How to make a complaint against an insolvency practitioner
Complaints Procedure

Kind regards,
Pavan

StepChange_Pavan

xxrobzyxx wrote: »

Hi,
This is my first post on here and i would really like some advice.
Me and my boyfriend are living in a privatly rented flat. He's 22 and i'm 21. Both of us have individual debt mine are about £5000 roughly and his are at least £9000. He is currently on a debt management plan paying £18 per week but they only cover his major debt and even then the company are taking about 5% for themselves. He has just recieved paperwork from the courts as one of his creditors has taken him to court and he just seems to have more and more people coming forward for money. He only works part time and even then his bank takes most of his wages for their charges because he has used the unplanned overdraft (not his choice to go into it they wont take it off his account and they keep taking charges which puts him in it that earns more charges) so he cant afford to pay much and the debt management company have told him he needs to pay more to add more debts which i dont think is fair as they know the situation. he has sent the creditors e-mails offering £5 and £10 per month but i dont know if he will be able to keep it up as money is always tight in our house.

As for myself i am paying all of the bills and only have about £50 per month to spend on food and no money to pay towards my debt. I tried going with the same debt management plan as my boyfriend but they told me it was going to cost me £80 per month which i cant afford. they also took £250 set up fee and then told me i couldnt have it back when i found i was unable to pay them. So right now none of my creditors are getting any money what so ever and i am now worrying that they will take me to court. I have been relying on payday loans to keep me going when i need extra cash and have to use them every month just to keep going. I do have a well paid job i get £937 per month but after bills its nearly all gone. And everyone I have tried to get help from has told me I earn too much money to qualify.

I feel so depressed all the time and I am always in tears because I dont have any money or a life. We have both considered going bankrupt but cant afford the court costs and it will take forever to save up.

Please somebody help me. I'm only 21 and i dont want to be in this situation anymore. I want to settle down and start a family but dont want to bring a child into this povety we live in. Everything is the cheapest i can get (Tesco's own brand of everything).

P.S sorry for the essay

Hi xxrobzxyzz and thank you for your post.

Firstly I’d like to reassure you that there will be options available to you and we can advise and support you along the way.

There are companies such as ourselves that can provide you with confidential and impartial advice, and most importantly we don’t charge for any of the services that we offer such as DMPs.

There may be other options available to you both, other than a DMP or bankruptcy, but we would need to know more about your situation before we can give you detailed advice.

I’d recommend that your boyfriend moves away from the account with the overdraft. He won’t be able to close the account as there will still be an amount outstanding. However, if he gets his money paid into an account where he doesn’t owe anything, there will be no risk of them taking money for themselves to pay towards fees or interest. It’s important that he opens a basic bank account to avoid the temptation of borrowing more money. He can then treat his overdraft like the rest of his creditors.

For us to give you further advice I’d really recommend that you use our online debt advice tool, Debt Remedy or call our free helpline to speak to a trained debt counsellor. You can call 0800 138 1111 and lines are open Monday to Friday 08:00-20:00.

I’d also recommend that you report the debt management company to the Office of Fair Trading, as they shouldn’t have taken such a large set up fee if they knew you couldn’t afford the DMP.

Hope this helps

Kind regards,
Pavan

Bosie

Hi, was wondering if there is a waiting list if you want the CCCS to help with a DRO?

Many thanks

StepChange_Pavan

Bosie wrote: »

Hi, was wondering if there is a waiting list if you want the CCCS to help with a DRO?

Many thanks

Hi Bosie and thanks for your post.

We can only provide the intermediary service to you if you have completed the full debt counselling process with us and one of our trained counsellors has determined that it’s the best possible option for you. We can usually offer you an appointment very quickly or alternatively you can log on to our online advice tool, Debt Remedy at any time.

There is no waiting list, but the amount of time it takes us to process your DRO would depend of the level of volume we have at the time you apply.

Kind regards,
Pavan