Bankruptcy only way forward.

January_Embers

We aren't saying we shouldn't pay or don't want to, we were just a little confused as to what an IPO was and how it worked. We are now enlightened

lewic

I temped at an insolvency practitioners once, and they told me that spouses were liable for their partner's debt, unless they were divorced before bankruptcy proceedings

Debt_Free_Chick

lewic wrote:

I temped at an insolvency practitioners once, and they told me that spouses were liable for their partner's debt, unless they were divorced before bankruptcy proceedings

Sorry, but that's rubbish. A debt is a contractual agreement between the parties concerned. If a spouse is not a party to the credit agreement, then the debt is nothing to do with them - and that applies on bankruptcy, divorce or death.

Debt_Free_Chick

January_Embers wrote:

1. If I go bankrupt how will that affect my wife? When filling out possessions forms can I ignore her stuff? If so will she need documents to prove it's hers.

She is not affected, unless you have joint debts i.e. credit where the agreement was in both your names, not just yours. You will be asked to list YOUR assets, so simply ignore hers. Possessions are NOT necessarily assets, unless they have some significant resale value. Even then, they might be ignored.

Also, ignore all general household possessions. The OR (Official Receiver) is not interested in your cooker, sofa, washing machine or any other item that you need to live a "normal" life. But the OR would probably not consider that an ongoing subscription to the gym, Sky TV or any other discretionary entertainment is necessary.

2. I need a computer and car for my work what is the likelihood that some evil so-and-so will make me sell them?

the OR is not an evil so-and-so. The OR is your friend. He/She will help you demonstrate that you have insufficient assets to pay all your debts. They will help you to identify those assets you have (if any), take them away, sell them, and use the proceeds as a part payment to your creditors. The OR will also help you to construct a robust budget which shows that you have enough to live on, but that you do not frivolously spend money on unnecessary luxuries (e.g. Sky TV).

OK ... that's a slight exaggeration ... but the reality is that the OR is somewhere between what I've described and an "evil so-and-so".

3. After bankruptcy I won't be able to run my own business. Could my wife run one and employ me? (Doing the same job I am now?)

With two or three exceptions you WILL be allowed to run your own business - especially if you are a sole trader. You won't be able to be a director of a limited company, thought.

The OR will want you to earn a living so that some of excess income, above that needed "to live" can be paid over and used to settle some of what you owe.

4. IPO now has me worried.

IPO is only enforced if you do not agree to an informal arrangement. The informal arrangement is one where, ignoring your current debts, you have more than enough to live on. Some of your surplus (income less essential living expenses) is passed to the OR who then distributes this to your creditors.

What's the point of voluntary bankruptcy if I still have to pay off the debts?

Oh, come on!!! The whole ethos of bankruptcy is that those who can't pay, don't pay. But those that can pay, do pay ... as far as their income and assets allow this. If you think about it, take a very wealthy person with an income of £500,000. But they run up debts which cost them more in repayments than they can afford. They declare bankrupt, with living expenses of £50,000 a year. Do you seriously believe that some of their surplus income should not be used to pay back some of what they owe?

The OR is only interested in taking some of your surplus income. If you have no surplus, then you won't have to pay any of the debts back (unless you have assets that can be sold). If you do have surplus income then you WILL have to pay some of the debts back and it's only right that you do.

Bankruptcy is for those who CAN'T pay, not those who can, but DON'T WANT TO pay. After all, you've actually spent someone else's money!

5. We have a mortgage on a house with little/no equity in joint names. What's the likeliest outcome with that?

Difficult to say. Whilst property prices continue to rise, then there may well be some equity in the future. And I think that the OR has a number years during which they can grab some of your equity. Of course, if the house is jointly owned 50:50 then only half of any equity, no matter how small, is yours. You might want to consider selling and then renting. If you go bankrupt then the house transfers to the OR anyway.

6. If I go bankrupt what happens about the CCJ against me?

Wiped out (but you may have to pay some of your surplus income, if any, to the OR and this will be used as a part-payment to the original creditor).

Read Guide to Bankruptcy

But before you leap in .... consider posting your budget here so we can suggest ways to improve your financial position (if we can).

Debt_Free_Chick

We have agreed lower payments with all creditors except LLOyds TSB who are hounding us with a CCJ.

I don't understand. Why is bankruptcy the only way forward, if all but Lloyds have agreed reduced payments?

I really think you should post your SOA, so we can see what we're dealing with here.

January_Embers

Debt_Free_Chick wrote:

I don't understand. Why is bankruptcy the only way forward, if all but Lloyds have agreed reduced payments?

I really think you should post your SOA, so we can see what we're dealing with here.

We have a DMP in place but our creditors continue to ring, text and write to us asking for more money. Had yet another one today from MBNA and they said, "sorry, computer error". All this is causing extra stress which is not helping my wifes health which has declined greatly over the last few months. Nor is it doing our marriage any good! I have to take time off work to look after my wife when she is particularly bad and then I don't get paid. Needless to say this causes added stress for both of us and my wife says she feels guilty for being unwell. Try having to come to terms with being disabled and your life changing and then finding out you are getting your family into debt because of it.
At the current rate it will take us 11 years to pay everything off. We cannot face a decade of this kind of stress and worry. We have been paying and paying for months but with less money coming in due to having to take time off, its just getting harder and harder.

We have sold just about everything that isn't nailed down on eBay and all the money goes on the bills. We are not the sort of people who own several cars, take lots of holidays abroad every year and only buy designer goods. We live as cheaply as we can.

Bestthingsinlifearefree

Hi January embers.

Why not post a SOA ? That is usually the best starting point.

Good Luck.

January_Embers

Hi
We posted a SOA on another debt forum several months ago and were given lots of helpful advice which we have heeded. Putting our affairs in the public forum (as it were) was and is very embarassing and we'd prefer not to have to do it again .

I have accepted my debt and have been paying it back but we like to keep our affairs private if we can.

Debt_Free_Chick

January_Embers wrote:

We have a DMP in place but our creditors continue to ring, text and write to us asking for more money.

Who is managing this for you? PayPlan, CCCS ... other?

Simply refuse to take the calls. Write to them and insist that they put everything in writing only. Pass the letters on to your DMP manager.

We have been paying and paying for months but with less money coming in due to having to take time off, its just getting harder and harder.

If your financial circumstances have changed, you MUST, MUST, MUST re-do your SOA and speak with your DMP manager. It may be that you need to revise your DMP or consider bankruptcy.

Debt_Free_Chick

January_Embers wrote:

Hi
We posted a SOA on another debt forum several months ago and were given lots of helpful advice which we have heeded. Putting our affairs in the public forum (as it were) was and is very embarassing and we'd prefer not to have to do it again .

I have accepted my debt and have been paying it back but we like to keep our affairs private if we can.

But we have no idea who you are.

As an example, tell me what you know about me ...?

Am I actually female, for example?