Is declaring Bancrupcy an answer?

cardy_2

In short I have £31,250 in debts and earn less than £1,000 a month. I have taken a PAYPLAN programme on but do not see it as an acceptable answer.
One of my debtors HFC Bank have accepted £14,000 as the final payment on a loan that I had got down to the last £6-7,000 but they are now charging me late payment fees (£210 in just over a year) and now have me as a bad debtor so will give me a bad report for credit.
When I took on this PAYPLAN agreement I thought .... OK you are now paying regualr accepted amount to everyone so in 6 years can start afresh.
Now one year on 50% of my debtors are still wanting more money and wanting late payment fees.
If declared bankrupt what are the implications? 6 years bad credit rating? Surely at least I would than know where I stand and genuinely count down to a regular rating.

Any advice welcome.
Thanks

fatbelly

Bankruptcy is AN answer - it may not be THE answer. There are pro and cons and I don't know enough about your situation.

There is a factsheet here

paul10mm

Sorry to hear of your problems,short awnser is yes for some its better to go bankrupt
it all depends on what you have to lose. you dont gain anything i went bankrupt last month for over £100,000 and now my fate is in the hands of the OR, i earn £1500 a month but would never have been able to repay my debts i live in a rented house and have a 7year old car so nothing for them to take there it becomes more difficult if you own your own house or have any value in it,that will be taken in some ways its better because you know in six years its all over with were as you have seen yourself they keep moving the goal posts Its not something i would recommend it very much deppends on how it will make you feel as a pearson too although a lot of the calls have stopped as well as the threats i still feel very guilty about the mess i got into and really would not have had to go bankrupt Just be honest with yourself and weigh up the pros and cons
If you do decide to go bankrupt i must say that the people you deal with are very nice far better than you can imagine!

Helen302

Hi cardy,

You started to explain on the other thread but I now I see what you're saying. Something seems to have gone majorly wrong with your dealings with Payplan? I can't see how this could happen? When you went through all your debts and income with Payplan in the first instance they would have sent out an offer letter to all your creditors showing what you can afford to pay and most, if not all, would have accepted. (Getting money back slowly is after all better than getting no money back at all (in their eyes.))

I had 12 creditors at the start of my problems and all accepted to freeze the interest. These "frozen interest/reduced rate" offers vary in length, some of mine expire after 6 months, 12 months etc. which is why I need to be on top of everything and thoroughly check the monthly statements, for instance I had a statement just last week that started charging me interest again so I immediately rang the company and told them my situation hadn't changed and that I would get Payplan to provide them with my latest expenditure/balance sheet, they were nice as pie about it. The only people that started creeping late payment charges on my statements was Sainsburys (Bank of Scotland) but I got straight onto Payplan and they renegotiated the 0%, I get hassle from Sainsbury's every now and again but some of these credit recovery departments work on commission hence them trying it on. I used to get a bit scared by them calling me up but I soon realised if you're firm and honest with them they realise they're not getting any more money than the agreed amount.

Have you been on Payplan's "justabank.co.uk" website to see amounts that are going to your creditors? It also shows you the date that they receive your money, bear in mind it takes 4ish days to transfer from your account to Payplan and then 4ish days onwards to the creditor. I moved all my due dates to accommodate for this. Also, Payplan only send a bulk amount of money to certain companies every week or so, they don't just send your money as soon as they get it hence any delays.

Hope this has been of some use? (Sorry it's a bit long, I know I ramble!)

Helen

slash40

hi, i went bankrupt last year owing about the same as you. i had no mortgage,expensive car or household goods. it was such a relief no more bailiffs, threatening calls or letters. ive had no qualms or second thoughts it was either b or risk losing what little i had, even being unable to feed my kids.
life is still hard but preferrable to what i had. but everyone is different with different circumstances. you must get expert advice and find out the implications of bankruptcy before you decide.

tsstss7

Hi Cardy I am no expert but have a few friends who have "gone bankrupt" recently - to them it has been a huge relief and literally saved them years of torment. There are obvious implications if you own anything of worth - house car etc. but if this is what you need to do you have nothing to gain by waiting. hope it works out for you.

janiewai

I went bankrupt on Monday and I feel nothing but relief, no longer am I scared of the post or a knock on the door

livilou

for some it is the only answer, have to say hubby's year was up in february and I have to say the day he returned from court with those papers was like a huge weight has been lifted, hubby had gone into his shell and I had spent weeks trying to come to agreements with creditors, dreading the drop of letters on the doormat every morning.

It was a huge relief but it brings about other issues, and I guess it depends what you have to lose, we have a house that jointly that I am currently in talks with the OR about - basically I have to buy hubbys share of the equity. obviously hubby now has issues re getting credit but to be honest - would you want credit now?

one thing that does annoy me though is that since hubby went bankrupt he has never had so many offers from companies for loans, offers of credit cards. what amuses me no end is these offers come from comapnies he had debts with???? I just smile when I open them now and chuck them away.

good luck
x

Clasics

livilou wrote:

It was a huge relief but it brings about other issues, and I guess it depends what you have to lose, we have a house that jointly that I am currently in talks with the OR about - basically I have to buy hubbys share of the equity....

Do you mean, say, for arguments sake hubby's share of the equity is £50,000, you have to pay hubby that so that he can pay off his debts? Sorry if this is a stupid question but I'm a bit of a newbie.

livilou

Clasics wrote:

Do you mean, say, for arguments sake hubby's share of the equity is £50,000, you have to pay hubby that so that he can pay off his debts? Sorry if this is a stupid question but I'm a bit of a newbie.

hi there,

it's not a stupid question hun,not at all. basically we had to get 3 valuations (don't go to a surveyor, get it done by an estate agent, we just made out we needed to move quickly) these were then sent to the OR and they then avergae them out to get the house value and then see what is left to pay on the mortgage. In our case there is only about 10K equity, this halved £5k hubbies share. they call it the beneficial interest.

I had to write a letter stating my interest and outlining my contribution to the mortgage, why I thought I had an interest etc.

I am still waiting to hear from the OR what figure they think I should pay and then a very helpful chap at the insolvency place said I could go back with my offer. You pay the OR.

So yes in basic terms you have to buy hubbies share of the equity but as to what the value is depends on the equity. in our case - thankfully there isn't much equity so it is manageable (well with a little help from the inlaws).

Any monies paid are then used to pay off the debts. So I guess really it depends on how much your debts are compared to how much you might realistically have to pay to keep the house (hope that makes sense!!).

I can only talk from the experience we have had and I think it really depends on individual circumstances, althought he principle is the same.

if you have any queries feel free to PM me.

good luck

xx