Ask a CCCS counsellor a bankruptcy question

CCCS_Sarah

peacock wrote: »

Hi, we need some advice about beneficial interest.
We both went bankrupt, and the OR says a relative can buy our beneficial interest for £1 as we are in negative equity. If we arrange that, and later decide that we can't afford to keep paying such high mortgage payments if the fixed rate ends and the B S make the new deal even higher, would our relative become liable to any shortfall if we were to give back the keys and let the debt on the house roll-up with the bankruptcy?

Hello,

I have attached a link to a booklet for you to have a read through. The booklet explains in detail about beneficial Interest

http://www.insolvency.gov.uk/pdfs/guidanceleafletspdf/home.pdf

Have a read through and give me a shout if you have any further questions.

Sarah

CCCS_Sarah

jojo1985 wrote: »

thanks matthew, all i received from co-op was a letter to say thank you for my interest but they wouldn't give me one, i rang and they said they only usually reject on grounds of fraud on my credit file, i have no knowledge of fraud and checked my credit report just incase and all was fine. Waiting to hear from barclays now. The biggest problem i'm having is with paying money in, particularly housing benefit, the only option is direct to landlord, which on average would leave me more out of pocket monthly!

I have attached a link to an Organisation called CIFAS, they are a fraud prevention service. The link will take you their complaints procedure; however this would need to be taken up with the creditor initially.

http://www.cifas.org.uk/default.asp?edit_id=606-59

If you are struggling to open a bank account and you are on benefits, you maybe able to open a post office account.

CCCS_Sarah

Goats1 wrote: »

Hello there,

I'd be very grateful if someone can answer my questions.

I had personal debts totaling £34k accumulated over 8 years or so. In May of this year I lost my job, and as a result of health and other issues, I've not been able to get another job since. I was not able to make any payments to my 7 creditors until this month. Due to the lack of any assets and prospects, I was on the brink of applying for bankruptcy when a relative kindly offered to help with settling my debts. The offer was conditional on me agreeing reduced settlement figures with all of my creditors to the tune of £17-18k. I negotiated and agreed "Full and Final" settlements with each of the creditors individually, and managed to get the money from the relative and pay them all £17.2k. A couple of creditors had already issued default notices, so I had to negotiate with their debt collection agencies.

My questions are:

- Was what I did an IVA? If not, what's it then?
- How does it compare to bankruptcy?
- What are the repercussions of it on my personal, work and financial future?
- If what I did was the wrong way of sorting out my situation, how can a rectify the matter and have it sorted?

Many thanks for taking the time to read and advise me!

- Was what I did an IVA? If not, what's it then? This sounds like just full and final settlements; these are an informal way of clearing the debts and the creditors agreeing to not take any further action.
- How does it compare to bankruptcy? Bankruptcy is a type of Insolvency and legal binding.
- What are the repercussions of it on my personal, work and financial future? This does not sound like an IVA, so would not be noted on your credit file as an IVA. Generally a full and final settlement would mark your credit file as satisfied.
- If what I did was the wrong way of sorting out my situation, how can a rectify the matter and have it sorted? If all your debts are cleared then this has sorted

CCCS_Sarah

Tigger2703 wrote: »

My partner and I are petitioning for bankruptcy as soon as we can get the fees togther, but there are a couple of things I don't understand about the fees. Most of the debts are in my name, from before we were together, but we do have a joint bank account that is £700 overdrawn and he has a few small debts from long ago that have just resurfaced.

If we go bankrupt as a couple, do we have to pay the court fees twice? If I do it on my own can a joint bank account be included, and if not is there any way of putting it in just my name before we submit the papers?

I'm also getting conflicting information on the court fees being anywhere between £300 and £900 in total, so can you tell me how much we will need to pay and at what stage in the proceedings.

I also can't work out if we qualify for any reduction to the costs (I earn nearly 11K and he earns about 13k per year and we're not on any benefits although we have been recently).

Thanks in advance for any help you can give.

V

Hello,

Thank you for your question.

Have you been for advice to see if Bankruptcy is your best option? If it is your best option then you could go bankrupt and then your partner could seek advice just on his budget, because if his debt is minimal then he could possibly look at making reduced payments if he could clear the debts in a reasonable amount of time.

The full cost to go bankrupt is £510, if you are on a low income then you maybe eligible for a reduction in this but how much would depend on your situation. For the reduction you would need to complete a form called an EX160A. You can get a copy of this from your local County Court or from the Courts website.

If you would like the CCCS to look at your options please call our helpline on 0800 138 1111 – all advice is free and confidential.

Sarah

smith1959

Unsecured Debts £85000 - approx
This months Income £1500

I am a self employed compliance officer working in a mortgage brokerage. I get paid a fixed fee for each consultant I supervisor. I also earn some commission when I write business which in the current market place is very low.Last September my fixed income was £2750 per month, and at the same time I woke up to the serious debt problem I had. Following advice from both CCCS and National Debtline I wrote to all my creditors offering reduced payments. All accepted and I was paying just over £1000 per month. However over the past few months consultants have been leaving and this month my income is £1500, and after allowing for my tax payment, car payment and fuel (car is needed for my role) I find I do not have enough to make my agreed payments to my creditors. I know also that my income for December and January will also be lower than it is this month. I need to draw a line with my situation as the burden of my debt is starting to effect my health. Under my old arrangement I caculated most of my debts would be repaid in about 8 years providing I maintained the income level. With the fall out in the mortgage market, this is now not the case. On £1500 income I will have approx £300 to £400 avaialble to pay my creditors.Would this be enough for an IVA or is bankruptcy the best route.I will need to resign my position if the bankruptcy route is taken. We have a joint mortgage and secured loan but are in negative equity. My wife pays the mortgage and secured loan and while she has a very well paid job I do not want her income to be used to "save my bacon" as she was unaware of our debt as I was very good at hiding it for many years.
Sorry the question is long, but I need to get as much written down, so your advice would be very helpfully. Finally until a decision is made on which is the best route for me to take I have decided to make token payments to my creditors advising them I seeking up to date help from both CCCS and National Debtline. I trust this is the correct decision.

kduffy101

hi all,
just recived a letter today from ACCOUNTANT IN BANKRUPTCY SCOTLAND,
i applied to go BR through the LILA route.
letter states...unfortunately since you own property then this route into BR does not apply to you.
house was sold on 18/09/2009.
called them today+explained this to the lady+she told me she could see in my file the letter from my lawyer telling me the house was sold for £xxxxxxx+that £xxxxxxx was paid to my mortgae +£xxx was being sent to me.
But because the LAND REGISTRY says i still own the house my application had falled+i will need to re apply+pay £100 again.
how often is the LAND REGISTRY updated?
any comments would be help full.
thanks

peacock

CCCS_Sarah wrote: »

Hello,

I have attached a link to a booklet for you to have a read through. The booklet explains in detail about beneficial Interest
(Link removed, see original question)
Have a read through and give me a shout if you have any further questions.

Sarah

Dear Sarah,
the booklet you linked to is the one we got from the court when we went bankrupt, and does not say anything about the legal repercussions if we give back the keys to the house in the event that we find that we cannot afford to continue payments IF the mortgage rate rises. If the beneficial interest is owned by a relative at that point, would they have any liability to the mortgage company to account for any shortfall? As our relative is not in a position to contribute if there is any liability, would we be better off not trying to purchase the BI and hoping there is not enough rise in house prices to take us out of the negative equity situation before the end of 3 years? By that time we should know if the revised mortgage rate after the end of our fixed rate term will be too high for us to afford.
Thanks for listening.

fermi

Buying the BI means that the purchaser is entitled to any surplus from the sale of a property, after secured debts are covered that is.

So if you buy that from the OR and the property later gains equity, you get to keep it rather than the OR.

But the purchase of the BI doesn't make you legally liable for a shortfall.

The above is to the best of my knowledge, and was the opinion of the Insolvency Service last time a checked.

Obviously, please take your own legal advice however.

ash5896

Hi Sorry to ask again

i have done a debt remedy plan on cccs website and have been advised to go bankrupt. at the moment my current income included my pay. if i go bankrupt i will have to give up my job as my contract states that the company does not employ anyone that has been made bankrupt or is bankrupt (work for a financial situation) so do i need to put this on the bankruptcy form as if i go bankrupt i will lose that income
any advice appreciated

Goats1

CCCS_Sarah wrote: »

- Was what I did an IVA? If not, what's it then? This sounds like just full and final settlements; these are an informal way of clearing the debts and the creditors agreeing to not take any further action.
- How does it compare to bankruptcy? Bankruptcy is a type of Insolvency and legal binding.
- What are the repercussions of it on my personal, work and financial future? This does not sound like an IVA, so would not be noted on your credit file as an IVA. Generally a full and final settlement would mark your credit file as satisfied.
- If what I did was the wrong way of sorting out my situation, how can a rectify the matter and have it sorted? If all your debts are cleared then this has sorted

Hello Sarah,

Many thanks for your answers. Could you please expand a little on the short, medium and long term effects of the couple of default notices and the "Satisfied" markings on my credit file? BTW, I'm 34 years old, and am an accountant by profession.

Your help is much appreciated!