Ask a CCCS counsellor a bankruptcy question

Lummi

Hi,

We are considering making my Husband bankrupt, at the moment his wages are paid into my Bank Account solely in my name, how would his bankruptcy affect my account?

Also we currently rent our flat from a private landlord (we have never missed a payment for over 4 years). Does the Bankruptcy mean they would be notified, as I feel this would count against us when we come to renew are tenancy and we are settled here?

Thanks in advance

philnicandamy

Lummi wrote: »

Hi,

We are considering making my Husband bankrupt, at the moment his wages are paid into my Bank Account solely in my name, how would his bankruptcy affect my account? if you have no "joint" debts and the account is sole your name then it'll be fine..

Also we currently rent our flat from a private landlord (we have never missed a payment for over 4 years). Does the Bankruptcy mean they would be notified, as I feel this would count against us when we come to renew are tenancy and we are settled here? depends on the receiver...some contact landlords some dont...you can ask at interview not to be contacted although its NOT a guarantee..sorry

Thanks in advance

Just a few thoughts

CCCS_Matthew

smith1959 wrote: »

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.

Hi there

It's really hard to say whether an IVA would be a possibility, as we'd need to be able to discuss your figures in more detail. Your best best is to call for another appointment so we can update your figures which will then give us the ability to discuss the relevent options you have to deal with your debts. In the meantime, offering token payments is generally considered a good thing until you have got the advice you need.

Matthew.

CCCS_Matthew

baled wrote: »

Hi
I have received a letter from the Official Receiver dealing with my brother's bankruptcy asking that I pay the receiver £2100 which was a loan my brother repaid to me last year before going bankrupt this year. I am sending a letter today informing him that I cannot afford to pay him this money as the sum was a personal loan which I arranged with my own bank at the time and subsequently repaid once my brother paid me.
Can anyone who has either been through this situation or advised/helped anyone through this answer some questions I have? I'd be really grateful if this is possible.
1. What proof will the receiver ask from me to back up my claim? Bank statements? Wage slips? And how far back would I have to provide these?
2. If I'm receiving tax credits will he count this within my income and ability to pay?
3. Do I have to declare any savings accounts as well as current accounts? I have just over £1000 in a savings account which was a backdated tax credits payment. I'm concerned if I tell him this, he'll demand I use that as payment.
4. My other brother has had a similar letter to me but for a larger sum. He is being made redundant at Christmas. Will he still be expected to pay?
5. If the decision is that I have to pay this money, can I appeal against it?
6. If all else fails and I have to pay, what payment arrangements are likely to be expected and how will they be set? Can I determine this or will he?
Sorry for the bombardment of questions, it would just be really useful to know these answers.
I understand that the receiver is perfectly entitled by law to demand this so called 'preferential payment' back and I say this in the politest possible terms that the law is an !!!. If you can't help out your family in times like these, who can you help?
Thanks in advance.

Hi there.

To my knowledge, you don't have to prove you don't have the money. The official reciever doesn't have the ability to go through your finances in the same fashion as they would have done with brother, as you are not part of the bankrutpcy. If you haven't got the money you can't be forced to pay it back.

The upshot is that if you cannot pay back the amount that is claimed, it's likely to lead to a restriction order on his bankrutpcy. This means he's likely to be made bankrupt for a longer period than the normal 12 months. This can be anywhere up to 15 years on the discretion of the official reciever.

Hope this helps,
Matthew.

CCCS_Matthew

fermi wrote: »

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.

Agreed.

You would only be personally liable for a shortfall if your name is on the mortgage for that property. Much like with unsecured credit debts, the liability for payment comes down to who has signed the agreement to pay.

The benefical interest means you have the ability to make a claim on the equity of the property when it's sold. Furthermore, if you have claimed beneficial interest, you are accepting no responsibility for having to pay towards the mortgage in future.

Matthew.

CCCS_Matthew

kduffy101 wrote: »

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

I believe it's the responsibility of your solicitors to update the land registry when you sell a property. The only suggestion I have would be to contact them and get confirmation of whether they've done this. They should also be able to tell you how often the land registry is updated.

Matthew.

fermi

CCCS_Matthew wrote: »

Agreed.

You would only be personally liable for a shortfall if your name is on the mortgage for that property. Much like with unsecured credit debts, the liability for payment comes down to who has signed the agreement to pay.

The benefical interest means you have the ability to make a claim on the equity of the property when it's sold. Furthermore, if you have claimed beneficial interest, you are accepting no responsibility for having to pay towards the mortgage in future.

Matthew.

Thanks Matthew.

CCCS_Matthew

ash5896 wrote: »

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

This is a bit of a difficult situation. If you go bankrupt and lose your job, you will be in a difficult position to maintain your living costs until you've found other employment. With that in mind you would be best not to include your current income on the bankruptcy forms, as you wouldn't be recieving it any longer. It might be best to check with your employer directly that bankrupcy definitely means instant dismissal. In some professions it maybe a case of finding you a job elsewhere within the company that is not affected by your bankruptcy.

It maybe best to look at whether there are any other alternatives to bankrutpcy. Did your Debt Remedy suggest any other options? If not you can always call the number provided within your booklet as it may help to discuss things in detail over the phone with somone who can see your figures.

Matthew.

CCCS_Matthew

Goats1 wrote: »

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!

If the account you are referring to was issued with a default notice, this will stay on your credit file for 6 years from date of entry. The fact the account is now shown satisfied is considered better than one that shows the debt still outstanding.

So in answer to your question, the only affect this has are the 6 years. No other timescales involved.

Matthew.

baled_2

CCCS_Matthew wrote: »

Hi there.

To my knowledge, you don't have to prove you don't have the money. The official reciever doesn't have the ability to go through your finances in the same fashion as they would have done with brother, as you are not part of the bankrutpcy. If you haven't got the money you can't be forced to pay it back.

The upshot is that if you cannot pay back the amount that is claimed, it's likely to lead to a restriction order on his bankrutpcy. This means he's likely to be made bankrupt for a longer period than the normal 12 months. This can be anywhere up to 15 years on the discretion of the official reciever.

Hope this helps,
Matthew.

Thank you for the info Matthew. It's a relief to know that the receiver can't can't get too involved in my finances but it makes me glum to think he could lengthen my brother's bankruptcy as a result... he's been through enough already this year.

Thanks again for your help.