Ask a CCCS counsellor a bankruptcy question

StepChange_Pavan

soontobesensible wrote: »

I think I really am in a mess now!!!!!!!!

Believe it or not I am currently holding a substantial amount of money for a friend who has been in dire straights and is saving for a new home ( I may be in hardship myself but I'll blow my own trumpet and say that I am a GOOD friend). The money is in a deposit account of mine for a number of reasons. I am due to hand it over to her soon!

What I'm concerned about is if I am made bankrupt myself which is probably quite likely, what will the OR think if he checks my accounts and sees that I have given this amount of money to this person? My worry is that he may try to get it back thinking that it is mine???

Any suggestions?:o

Hi soontobesensible and thanks for your post.

As long as you can prove that the money isn’t yours and explain your situation you should be fine. Unfortunately it becomes more complicated if you’re unable to prove that the money belongs to your friend.

It’s best that you give us a call so that we can advise you more thoroughly on your options and explain what to do. You can call our Helpline on 0800 138 1111 (free including from mobiles). We’re open Monday to Friday 8am - 8pm and Saturdays 9am – 3pm.

Kind regards,
Pavan

JessBright

Hi everyone,



I’m self-employed at the moment, and my income fluctuates. I’m just about to go on maternity leave for 6 months, and will be going back to an office job part time in mid-February. I live in a rented flat with my new husband, who earns about £20,000 per year.

I have nearly £40,000 worth of debt from 5 creditors (3 of which are Lloyds) from a failed business venture 6 years ago. I’m on a debt management plan at the moment, and I’m paying £200 per month towards my debts.

This isn’t even paying the interest, and I’m very keen for this situation to change, particularly having just got married and with a new baby on the way. I have offered a settlement figure to my creditors twice now, the last being £12,000. All my offers have been refused, and I have been told by my debt management company that at least £20,000 to £25,000 would be needed to settle. In my present situation this would be completely impossible, and I can’t see that changing in the future.

Our priority at the moment (apart from paying my debts off) is to buy our own house, which we hope to do in five years or so. I’d like to know whether it’s better for me to get this situation resolved ASAP and go bankrupt, or whether to stay as I am now? Is it better to get a mortgage as someone on a debt management plan who has built up better credit in the meantime, or as someone who has recently been bankrupt?

I have built up better credit over the last 3 years – paid all my bills on time, been given a debit card by the bank etc – would the mortgage provider take this into account? And then possibly we could remortgage the house a few years later and I could pay my debts off that way?

If it’s the best course I’m happy to go bankrupt now, and wonder if it is best to tackle this head-on and resolve it, wipe the slate clean, and start building better credit? If so, is it better to do whilst I’m on maternity leave, or when I’m back at work part-time next year?

What information will the official receiver need from me exactly if I go bankrupt and I’m still self-employed? Or if I wait till I’m employed again?

I have a car that I currently use for my business – should I sign it over to my husband now, and wait till next year to go bankrupt?

With either of these two options, how long can I realistically expect to wait before I can get a decent mortgage?

Thanks very much,


Jess

StepChange_Pavan

JessBright wrote: »

Hi everyone,



I’m self-employed at the moment, and my income fluctuates. I’m just about to go on maternity leave for 6 months, and will be going back to an office job part time in mid-February. I live in a rented flat with my new husband, who earns about £20,000 per year.

I have nearly £40,000 worth of debt from 5 creditors (3 of which are Lloyds) from a failed business venture 6 years ago. I’m on a debt management plan at the moment, and I’m paying £200 per month towards my debts.

This isn’t even paying the interest, and I’m very keen for this situation to change, particularly having just got married and with a new baby on the way. I have offered a settlement figure to my creditors twice now, the last being £12,000. All my offers have been refused, and I have been told by my debt management company that at least £20,000 to £25,000 would be needed to settle. In my present situation this would be completely impossible, and I can’t see that changing in the future.

Our priority at the moment (apart from paying my debts off) is to buy our own house, which we hope to do in five years or so. I’d like to know whether it’s better for me to get this situation resolved ASAP and go bankrupt, or whether to stay as I am now? Is it better to get a mortgage as someone on a debt management plan who has built up better credit in the meantime, or as someone who has recently been bankrupt?

I have built up better credit over the last 3 years – paid all my bills on time, been given a debit card by the bank etc – would the mortgage provider take this into account? And then possibly we could remortgage the house a few years later and I could pay my debts off that way?

If it’s the best course I’m happy to go bankrupt now, and wonder if it is best to tackle this head-on and resolve it, wipe the slate clean, and start building better credit? If so, is it better to do whilst I’m on maternity leave, or when I’m back at work part-time next year?

What information will the official receiver need from me exactly if I go bankrupt and I’m still self-employed? Or if I wait till I’m employed again?

I have a car that I currently use for my business – should I sign it over to my husband now, and wait till next year to go bankrupt?

With either of these two options, how long can I realistically expect to wait before I can get a decent mortgage?

Thanks very much,


Jess

Hi Jess and welcome to the forum.

Congratulations on the baby and your wedding! It’s difficult to say what your best option is without discussing your situation in a lot more detail.

You’re right that any debt solution will affect your credit file and your eligibility for a mortgage. If you do decide to go bankrupt this is likely to affect your chances more, but either way you would need to save for a deposit which will be difficult whilst you have outstanding debts.

I’d really recommend that you call our helpline so that we can talk through your options thoroughly and recommend that best course of action. You can ring us on 0800 138 1111 (free including from mobiles). We’re open Monday to Friday 8am - 8pm and Saturdays 9am – 3pm. If you’d prefer you can use our online debt advice service Debt Remedy (http://www.cccs.co.uk/ref/drcu) – although as your situation is changing soon and will do again in the near future it may be best to call.

I hope this helps.

Kind regards,
Pavan

Stubop

Hello,
My wife and I currently live with my Mother - in -law who has a CCJ against her. Can anyone tell me if the CCJ is registered to the address and will that make it difficult for my wife and I when we apply for a mortgage or credit?

Thanks
Stu

StepChange_Pavan

Stubop wrote: »

Hello,
My wife and I currently live with my Mother - in -law who has a CCJ against her. Can anyone tell me if the CCJ is registered to the address and will that make it difficult for my wife and I when we apply for a mortgage or credit?

Thanks
Stu

Hi Stu and thanks for your post.

Your mother-in-law’s CCJ will be registered to her rather than the address so it shouldn’t affect you provided that you don’t have any joint finances.

If you’re concerned you could check your credit file to see what’s on there and if you were financially connected you can disassociate yourselves – there’s more information about this on page 10 of this leaflet: http://www.ico.gov.uk/upload/documents/library/data_protection/practical_application/credit_explained_leaflet_2005.pdf.

I hope this helps.

Kind regards,
Pavan

dragon566

My partner and I would like to obtain a mortgage in the near future. Unfortunately, I was declared bankrupt in October 2008 and discharged 12 months later. Since then I have had no credit. I am also in full time permanent work and as I am a teacher, I have job security. I need to find out how I go about trying to obtain a mortgage or even if it is possible? Is there any kind of credit card that would help me to build up credit?

The other worry I have is that we would like to obtain a joint mortgage, does this mean my financial history will now be on her records and affect her obtaining of credit in the future? I'm totally confused and very worried!!!

tigerfeet2006

dragon566 wrote: »

My partner and I would like to obtain a mortgage in the near future. Unfortunately, I was declared bankrupt in October 2008 and discharged 12 months later. Since then I have had no credit. I am also in full time permanent work and as I am a teacher, I have job security. I need to find out how I go about trying to obtain a mortgage or even if it is possible? Is there any kind of credit card that would help me to build up credit?

The other worry I have is that we would like to obtain a joint mortgage, does this mean my financial history will now be on her records and affect her obtaining of credit in the future? I'm totally confused and very worried!!!

Dragon, post this on the main bankruptcy board as well.

mynumber

Hi, Im heading towards bankruptcy unfortunately, i took out a loan in 2010 for a car for my son. Hes paying this and its registered in his name. The loan is a fixed sum loan with Santander, is this the same as a finance loan, if i do go bankrupt will my son lose the car. hope you can help k

livbob

Hi please can you give me some advice I seem to be going around in circles ! My husband is wanting to go br, I'm not too sure we earn with ot 3 500 our outgoing are 747 motgage sescurd loan 338 Iva 550 crdit card 100 catulogue 150 , then all the usual bills , do you think we shyd go. br? Will we have to pay over the 3 yrs , can yiy have a holiday ? Still not sure if we will loose the house .thanks for reading

StepChange_Pavan

dragon566 wrote: »

My partner and I would like to obtain a mortgage in the near future. Unfortunately, I was declared bankrupt in October 2008 and discharged 12 months later. Since then I have had no credit. I am also in full time permanent work and as I am a teacher, I have job security. I need to find out how I go about trying to obtain a mortgage or even if it is possible? Is there any kind of credit card that would help me to build up credit?

The other worry I have is that we would like to obtain a joint mortgage, does this mean my financial history will now be on her records and affect her obtaining of credit in the future? I'm totally confused and very worried!!!

Hi dragon566 and thanks for your post.

Your bankruptcy will remain on your credit file for 6 years so it won’t drop off until 2014. Even after this date, some mortgage advisors can ask if you’ve ever been declared bankrupt in the past.

Here is a really useful article which explains how credit files work and how you can work at improving it: http://www.moneysavingexpert.com/loans/credit-rating-credit-score.

You’re right that if you have any joint accounts you will be financially connected but if this becomes a problem you can financially disassociate yourselves. Page 10 of this leaflet explains more: http://www.ico.gov.uk/upload/documents/library/data_protection/practical_application/credit_explained_leaflet_2005.pdf.

I hope this helps.

Kind regards,
Pavan