Bankruptcy: Help and advised needed please!!!!!!

JKM_3

Hi everyone,

I am new to the forum and was advised by my friend to come on here for some advice.

My mum is in alot of trouble with debt, totalling to around 70k and she only has 31 months left of work. She went to the CAB and originally refused bankruptcy as she wanted to pay her debts as she felt it was the right thing to do so they put her in touch with an IVA company..

They have sent her all the paperwork and want her to pay 2k a month along with taking 18k of her pension, she does earn good money at the moment, just over 3k a month but she works on-call in a hospital which bumps her money up but with cuts at work it doesnt look like this option will be available for much longer. The IVA company want to charge her 2k a year from her including 2k upfront which they insist she must find! Over the whole plan they will take nearly 10k which to me seems completely unreasonable to someone trying to get out of debt!!

She doesnt own any property and she only has a cheap car so essentially has no assets, I am trying to convince her to go bankrupt as she has nothing to lose, if she goes with the IVA she will be left with nothing to live on and they will rob her of half her pension, considering she has to pay rent for the rest of her life it just seems impossible.

She is really depressed and struggling to get through this so I have said I would help her, we are going to CAB in the morning and I have looked through the fact sheets on this website but I just wondered if anyone had been in a similar position? I have a few questions I am hoping someone can answer..

As she currently earns good money how likely will she be accepted for this (she currently can only make minimum payments)?

How much roughly would she be expected to pay back?

What sort of household items would they see fit to take?

How long does the process take?

Any feedback is greatly appreciated.

Thanks
JKM

Merry_Gentry

Welcome to the Forum :hello:

As she currently earns good money how likely will she be accepted for this (she currently can only make minimum payments)?
If her outgoings outstrip her income, then she is insolvent.

How much roughly would she be expected to pay back?
Dependent on her SOA, anything over £99 they would take a percentage of for three years.

What sort of household items would they see fit to take?
They don't take normal household items - only items that are worth over £1,000 are looked at by the OR if they are listed by you in your petition.

How long does the process take?
Depends on your local court. Some have a waiting list, some have a drop in service. She would need to get advice (CAB is fine), complete the forms, and have the money ready to pay. She would be bankrupt for a year unless she got early discharge, and it would remain on her credit file for six years.

JKM_3

Thanks Merry - could you please explain what an SOA is? and I wasnt clear on your answer about how much they would take??

dottydora

If she went BR and if she got an Income payments arrangement for the 3 years I think that once she stopped working the income and expenditure would be reassessed and presumably the IPA would be cancelled.

Lightattheend

SOA = Statement of Assets (I think) but is basically a list of income and expenditure

dottydora

I'm sure someone will be along with a little table that tells you how much should be paid depending on the surplus of income left each month. And I'm sure they will give you the link to the SOA. I can't advise but it certainly sounds like BR would be more appropriate than an IVA.

dreamcatcher73

soa is a statement of affairs, where she lists her income and expenditure - bills etc, then the OR can see how much surplus income she has for debt repayment

Merry_Gentry

Get your mother to fill this in:

http://www.makesenseofcards.com/soacalc.html

Then we can have a look at her income and expenditure and help her sort out what's allowed, etc.

Lightattheend

blind-as-a-bat wrote: »

Statement of affairs, not that it matters:p

Thought it didn't sound quite right!!

dreamcatcher73

I am right in thinking that an IVA lasts for 5 years? So if OP's mother will only be working for another 31 months she will not be able to complete this and will have to default and go BR anyway?

Please correct if I am wrong, still get confused with these things..

spenderblender

I am right in thinking that an IVA lasts for 5 years? So if OP's mother will only be working for another 31 months she will not be able to complete this and will have to default and go BR anyway?

I also thought that this was a bit strange along with the op needing to find 2k up front. Does sound a bit dodgy.