Ask a CCCS counsellor a bankruptcy question

StepChange_Pavan

QuestionTime wrote: »

I am comparing Trust Deed to Bankruptcy, and it seems to me that your credit reference is effected equally. Bankruptcy allows you to move on more quickly. Its not like a Trust Deed protects your credit rating in any way - ie, there is no credit rating incentive to go that way. It also holds you into an agreement for three years, at which point you are two years behind where you would have been with bankruptcy?
Just trying to weigh up implications of each scenario...

Hi QuestionTime and thanks for your posts.

There are many differences between a Trust Deed and bankruptcy and the effect on your credit file is just one of them.

You’re right that both would stay on your file for six years but bankruptcy is a more ‘severe’ form of insolvency and could affect your ability to get a mortgage even after the 6 year period.


If you’d like some more detailed and impartial advice you can get in touch with us.

Kind regards,
Pavan

don240

CCCS_Pavan wrote: »

Hi don240 and thanks for your post.

Are you including your ex father in law in the bankruptcy? It shouldn’t be a problem that you were paying him a slightly higher percentage whilst in your DMP but it’s highly unlikely that you will be allowed to continue paying him whilst you are bankrupt.

Insurances and telephone costs at your new address shouldn’t be a problem provided that it’s not excessive expenditure and within your means.

The worse that could happen is that you will be given an Income Payment Order if you have an available surplus or your bankruptcy could be extended.

I hope this helps, but you can call our helpline to speak to our specialist bankruptcy team if you need more detailed advice.

Kind regards,
Pavan

Hi Thanks for the reply.
I am including my ex father in law & I have now stopped my payment plan,
I have spoke to the CCCS & have been reasured that the worse that could happen is that I get a year or two with a bankruptcy restriction order.

I think I am paying more for phone/net etc than I will be allowed, it depends on being allowed to keep my car as to wether I have to pay an IPO,

Regards

Don240

mr_devon

I have recently had a ccj issued against me for a debt that I owe MBNA for £13,000. When I sent back my admission form, I also wrote a letter explaining that we closed our shop last year due to not being able to make ends meet and that I now have very little income.

I sent an income and expenditure sheet that I filled in on the advice of National Debtline and all I could offer was £21 per month. The judgment says I must pay the claimant the full amount by instalments of £21.

It also says on the form that the claimant has objected to the rate of payment offered.

I have now received a Notice Of Redetermination letter saying that the case will be transferred to my local court. I rang Restons to see what it's for and they say they will be seeking a Forthwith Order and Charging Order. I'm not sure what these mean and how they will affect me. My house is in negative equity by about £15,000 and I genuinely can't afford to pay them any more.

My parents have offered to lend me some money to help out but nowhere near enough to pay them off. I rang Restons to make an offer to pay them £3,000 in full and final settlement if they would cancel the judjment but they said (quite understandably) that this amount was nowhere near enough. I don't want to borrow the money off my parents anyway but they would like to see me get this sorted without a judgment against my name if at all possible.

I did think though that a lump sum would be better for them than paying £21 per month forever. When they refused, I paid my 1st instalment over the phone by card and told them that I will explain to the court when I go that I tried to come to an agreement. My financial situation is not likely to get any better any time soon. What do you think I should do?

StepChange_Pavan

mr_devon wrote: »

I have recently had a ccj issued against me for a debt that I owe MBNA for £13,000. When I sent back my admission form, I also wrote a letter explaining that we closed our shop last year due to not being able to make ends meet and that I now have very little income.

I sent an income and expenditure sheet that I filled in on the advice of National Debtline and all I could offer was £21 per month. The judgment says I must pay the claimant the full amount by instalments of £21.

It also says on the form that the claimant has objected to the rate of payment offered.

I have now received a Notice Of Redetermination letter saying that the case will be transferred to my local court. I rang Restons to see what it's for and they say they will be seeking a Forthwith Order and Charging Order. I'm not sure what these mean and how they will affect me. My house is in negative equity by about £15,000 and I genuinely can't afford to pay them any more.

My parents have offered to lend me some money to help out but nowhere near enough to pay them off. I rang Restons to make an offer to pay them £3,000 in full and final settlement if they would cancel the judjment but they said (quite understandably) that this amount was nowhere near enough. I don't want to borrow the money off my parents anyway but they would like to see me get this sorted without a judgment against my name if at all possible.

I did think though that a lump sum would be better for them than paying £21 per month forever. When they refused, I paid my 1st instalment over the phone by card and told them that I will explain to the court when I go that I tried to come to an agreement. My financial situation is not likely to get any better any time soon. What do you think I should do?

Hello mr devon and thank you for your email.

It sounds as though you already have a CCJ and because they’re not happy with the amount they’ve applied for a charging order.

This effectively adds a charge onto your property and secures the debt against it. If you were to sell the house the debt would be repaid before you received any proceeds. However as you’re in negative equity, this wouldn’t happen and it’s more likely that they would stop the sale from going through.

If you’d like us to look at your situation in more detail and advise you on your options you can call our free helpline on 0800 138 1111. We’re open Monday to Friday 8am - 8pm and it may be possible to refer you directly to a counsellor for immediate advice. Alternatively, we will arrange for an appointment to be booked at a time convenient for you.

I hope this helps.

Kind regards,
Pavan

StepChange_Pavan

Hello!

The MoneyAware team are out of the office from this afternoon until Wednesday morning. We’ll get back to you as soon as we can.

In the meantime you can still get debt counselling through our online service Debt Remedy 24 hours a day and you can also read our blog at http://moneyaware.co.uk/

Kind regards,
Pavan

nearlyfree_2

hi, we are due to be discarged from the bacncrupcy in November. Before I filled for bancrupcy, I was working in partnership - it was dissolved, I took over by myself and continued working. IT ended up being messy.
Could my ex business partner sue me for money owned after the discharge?
Many thanks

System

nearlyfree wrote: »

hi, we are due to be discarged from the bacncrupcy in November. Before I filled for bancrupcy, I was working in partnership - it was dissolved, I took over by myself and continued working. IT ended up being messy.
Could my ex business partner sue me for money owned after the discharge?
Many thanks

Hi Nearlyfree and welcome to the forum.

Without knowing the full details of your situation I’d recommend that you speak to the Official Receiver who dealt with your bankruptcy.

As he/she has access to the details of your case they should be able to give you a definitive answer.

I hope this helps.

Kind regards,

Mat

tkwinston4

Hi.
My husband is being made bankrupt by HMRC for an outstanding VAT debt of about £50K. He has recently made his business a Ltd company and the VAT debt was prior to that. Our house is in negative equity and we both have quite a few other debts. However we have never missed a payment on our mortgage or any other bills. He has been to a solicitor who couldnt help and has also tried an IVA a bank loan and a VAT specialist and none of them can stop HMRC from making him bankrupt.
I have read lots of information about it but none have really explained what happens now. Is there any way we can keep our home and he can keep his Ltd business?
There are no assets in the business because the building is rented, all the equipment is rented and the vehicles arent worth much either. He is a mechanic so its just his tools that are of any value.
All advise welcome.

StepChange_Pavan

tkwinston4 wrote: »

Hi.
My husband is being made bankrupt by HMRC for an outstanding VAT debt of about £50K. He has recently made his business a Ltd company and the VAT debt was prior to that. Our house is in negative equity and we both have quite a few other debts. However we have never missed a payment on our mortgage or any other bills. He has been to a solicitor who couldnt help and has also tried an IVA a bank loan and a VAT specialist and none of them can stop HMRC from making him bankrupt.
I have read lots of information about it but none have really explained what happens now. Is there any way we can keep our home and he can keep his Ltd business?
There are no assets in the business because the building is rented, all the equipment is rented and the vehicles arent worth much either. He is a mechanic so its just his tools that are of any value.
All advise welcome.

Hi tkwinston4 and thanks for your post.

If he is being made bankrupt by the HMRC, it’s unlikely that there is anything you can do at this stage.

However, you could contact business Debtline http://www.bdl.org.uk/ for some more detailed advice.

Kind regards,
Pavan

Raspberry_Swirl

Hi

My ex partner signed the house (which at the time we own jointly) over to me last year, but there's still a secured loan against it in both names. I can't just take his name off of the loan as the Halifax say that product no longer exists, and currently I can't afford to take out a new loan to cancel that one out as the repayments would jump by £150 a month.

He's now applying for bankruptcy (just found out) and obviously, this loan has been found by the agency doing the checking.

This loan was originally his debt. Is there anything I can do at the moment to avoid being connected to his bankruptcy, apart from telling him he can't go ahead with it?!

Many thanks