Bankruptcy - Got a few questions.

skylight

Okay - as (some of) you guys know, Payplan suggested we go bust.

We are still fighting it. Mainly because I don't really want someone going into detail about our affairs (financial!) and I don't feel comfortable with that. I don't like this being "probed" feeling.

So all the chats we (OH and I) have had have drawn up some real/some hypothetical questions that I don't know the answers to.



1. This is the most important and Payplan didn't know a proper answer. DD1 was given £24k in compensation. We can prove this is hers and not ours, but as she is under 16, the cheque was made payable to hubby. Will the OR try to take this when its not ours? We have already put it away in trust for her. And please - no suggestions about using it to pay back what we owe. Its stealing - its not our money.

2. Does the OR go into detail of our new transactions??? I am under the impression that bankruptcy gives us a clean slate up to that point and its those detials he is interested in. When we open a new account, will he have access to our new account? (This is hypothectical - we have no intention of ever borrowing anything ever again from anywhere ever - not ever - but goes back to the feeling "probed" problem!)

3. How often will they contact us? Are we going to be inundated with calls from the OR like we are with creditors?

Can I have some help on these guys?????

Toto

I have no idea how to answer your question but I did want to say I totally understand why you want to protect your daughter's money. I have a very handicapped daughter (autism, fragile x, epilepsy, adhd) and I would hate for anyone to get hold of her DLA. It's her money which pays for her extra therapies etc.

I know looking at bankruptcy is a scary thing, so I wanted to give you a big hug this wet monday morning.

x

whatamess_2

This is nothing to do with the op. Sorry:o
Just wanted to send a (((hug))) to Toto and her dd, to have one of those conditions is bad enough all 4 together ouch.

Crikey hope that doesnt sound patronising, I work with young people affected with the same. So can appreciate how difficult it can be for the parents.
Messy

andystev

Bankruptcy for me was discharged well over 10 years ago, I’m no expert, but can answer some of your questions from that experience.

Q1: Don’t know for sure, but in my experience the OR was a reasonable chap. He explained what options I had to protect certain assets & gave me time to sort out what I wanted to do.

My advice would be to talk to CAB, push payplan for a definitive answer, and maybe talk to a solicitor. Definitely have the situation clear in your head before you file.

Q2: This will depend on your earnings I think. If you earn over a certain amount he’ll want a slice of it. Personally, I never saw or heard from him again.

Q3: See Q2. They pretty much leave you to get on with life. That’s the whole idea in the first place.

This isn’t a small step. Make sure you have all the answers to your questions before you go ahead. Don’t forget there’s a fee & you’ll probably need the services of a solicitor. So it’s not inexpensive.

You’ll be discharged after 3 years I think, but be aware that your credit report will be stuffed for 6 years and most mortgage lenders will require you to declare if you’ve EVER been bankrupt. So if you’re an honest type, you’re pretty much stuffed for life from a mortgage point of view. Although lenders are getting less fussy about aged bankruptcies I believe.

I’m not trying to talk you out of it. In some circumstances it’s the best option. I would caution you to explore every other option before you take this step though. Get advice, lots of it. CAB were really helpful for me & talk to the bankruptcy association, if it’s still around.

HTH.

tyllwyd

I'm not a lawyer, but my best guess would be that if the money is held in trust for the benefit of your daughter, then the trustees would only be allowed to use it for her, and they couldn't make it available to pay your debts (unless that was in her interests, maybe if otherwise you would lose the family home and she would be homeless). But I think you should take all the documents about the compensation, setting up the trust etc to a solicitor and get a proper answer - if your daughter got as much as that in compensation, it must have been something serious and you owe it to her to make sure that money is safe for her.

tyllwyd

You know, the more I think about it, the more it seems to me that if the trust has been set up properly, the asssets of that trust belong to your daughter and your bankruptcy shouldn't involve that money (although obviously I could be wrong). But if either of you are trustees of the trust, are you allowed to continue as trustees if you are bankrupt? It might be worth double checking, in case you need to appoint new trustees beforehand.

missk_ensington

There is absolutely no way they would take your daughters money to pay your debt, and nor would they even need to know about it. Unless I am mistaken, there is nowhere on the Bankruptcy forms that ask about bank accounts and monies of people in your household under 16. The thing with bankruotcy is they only know what you tell them, as many of you know my ex was going bankrupt with 90k of debt and got away with allsorts.

He managed to launder 90k, put it in an offshore bank account, keep his caravan and motorbike (no one knew he had the static caravcan and he 'sold' the bike to a mate, who will just give it him back after discharge). I'm NOT condoning what he did, hence why he is now my EX partner, but the point I'm making is it relies on trust. The OR can only investigate the bank accounts he knows about, he doesn't actually phone up every account provider in the world and see if you have an account with them!

However, yes the OR will probably probe, that's his job, but if you're in this situation because of bad luck and hardship, he isn't going to be horrible. People have every sympathy for genuine case bankrupts, just not if you've spent it on luxury holidays and getting p1ssed every night!

x

cookiesncream

missk_ensington wrote:

However, yes the OR will probably probe, that's his job, but if you're in this situation because of bad luck and hardship, he isn't going to be horrible. People have every sympathy for genuine case bankrupts.

My hubby's OR made him cry he was that unsympathetic but we just got unlucky. They wouldn't take the trust money, you can prove it's not yours as it would've had to go through an adult. The OR won't go through your future transactions unless you ask for permission for certain things (credit over a certain amount, cease of payment to pay a bil etc). The OR is all a paper-pushing job so once you have met with him (or over the phone) and come to an arrangement, you will only be contacted if you contact them. Unless it's something like you haven't paid an agreed amount.

I hope this helps and it all goes without too many glitches. The main thing to remember is that you will be asked alot about where certain money's gone even if it's general spending but aslong as you can back it up then you're ok. They're just trying to find out if you're scamming them, or not. I'm not trying to scare you off, I just wish someone had given us the same advice!

bingo_kitty

Hi charlotte664,

1. This is the most important and Payplan didn't know a proper answer. DD1 was given £24k in compensation. We can prove this is hers and not ours, but as she is under 16, the cheque was made payable to hubby. Will the OR try to take this when its not ours? We have already put it away in trust for her. And please - no suggestions about using it to pay back what we owe. Its stealing - its not our money.

The OR will request your bank statements and as the cheque was made out to your OH it will be queried - if you can prove that it is for your daughter [and it should be moved into a seperate account unless you want it seized by the bank to ofset any debts] then the OR will be satisfied - if you *can't* prove that it's your daughter's it will be treated as an asset in your bankruptcy and used for the benefit of your creditors.

2. Does the OR go into detail of our new transactions??? I am under the impression that bankruptcy gives us a clean slate up to that point and its those detials he is interested in. When we open a new account, will he have access to our new account? (This is hypothectical - we have no intention of ever borrowing anything ever again from anywhere ever - not ever - but goes back to the feeling "probed" problem!)

The OR will not have access to any accounts you open after the date of your bankruptcy order *unless* when a review of your case is undertaken it comes to light you are breaching the terms of the bankruptcy i.e obtaining credit of more than £500 without declaring you are a bankrupt.

3. How often will they contact us? Are we going to be inundated with calls from the OR like we are with creditors?

Normally it's the bankrupts who contact us more than we contact them!

You'd probably have either a face to face or a telephone interview going over the cause of your failure. You mightrecieve a few letters asking for more information and it's only reallyif you ignore the OR that we start calling.

You might still have some *creditors* calling you but contacting your case clerk will tend to put a stop to that.

Lastly if you decide to go bankrupt you might just have to accept that they are going to want to know what happened whether you liked feeling probed or not - it's the reason the OR exists, but we're not bad people and I can assure you we've heard it a million times before and worse stories than yours!

*hugs*

hope that helps clear things up for you:A

bingo_kitty

Oh yeah I forgot...

it's 1 year automatic discharge now and in *most* cases where there are no reckless behaviour i.e. gambling drinking money away reckless spending, obtaining credit knowing you can't pay it back etc it's classed as an early Discharge - at 3 months we do an income expenditure review and contact your creditors if no one objects [and they can't object because they are no longer getting money] you get discharged.

But it is a big step if you want a mortgage - that said is having another big debt the most important thing or is being able to enjoy your life and have enought money left at the end of the month more important?

Wishing you well

skylight

Bingo-kitty - many thanks for that!

I *know* that we are going to be probed - I am not comfortable with that, but its a case of tough luck on me. I am just not a open person and hate relying on others - which is exactly what I will have to do if we go bankrupt!

Should I speak to a solicitor first? We have spoken to Payplan and they haven't mentioned a solicitor, but is it neccessary? We can't really afford it.

And with daughters compensation, we can prove exactly where its come from and that its hers, so I am much happier about knowing OR's can't take it.

And with the way our luck has gone over the last few years, I am expecting a horrible OR. Do you think some home made cookies to the court would help :rotfl: