In A Bit Of A Pickle

JimmyRiddle_2

Hi all,
Cut a long story short - Number of Debts as Listed Below:
Me
4900 - Barclaycard
4400 - Barclays bank loan
1600 - Egg (1st Credit)
250 - Goldfish - Now Barclaycard
6400 - MBNA

Wife
2200 - Barclaycard
1800 - Mint
500 - Barclays Overdraft
4300 - Halifax Credit Card
7500 - MBNA (Restons) - Now subject to Final Charging Order

Joint
18000 - Royal Bank Of Scotland - Subject to Interim Charging Order
100 - Barclays Bank Overdraft
900 - Barclays Bank Overdraft

As you can see, quite a sizeable amount in total.

We are currently in a DMP with Payplan who seem about as much use as a chocolate fireguard in offering advice.

We have been advised by the District Judge at at the Charging Order hearing to go Bankrupt as he cannot see how we could possibly repay all of our debts at the current rate (£135 via Payplan). Ideally we want to avoid bankruptcy as we have a 4 yr old and we would lose our house (so i'm lead to believe). The house is valued @ £105000 (at best) and we owe £128000 to Nortern Rock.

We are currently looking to explore our options and someone has mentioned a Debt Relief Order for my Wife as, if the 18000 loan is made into a final charging order, she will have less than £15k in her debts (can the Charging orders be excluded from the DRO?)

Wife is self employed and owns a 52 plate Saxo (val approx £1000 as has a big dent in the side we can't afford to fix) and has no excess income after meeting essential bills (my wage currently pays DMP).

After a bit of advice as no one is giving us any real direction.

In an ideal world, I wouldn't have been made redundant a year ago and had to take a job earning £11000 a year less and we wouldn't have got in this mess.

Any help would be great.

SouthCoast

Information on DRO's
http://www.insolvency.gov.uk/bankruptcy/alternativestobankruptcy.htm

Threads here:
http://forums.moneysavingexpert.com/forumdisplay.html?f=136

Oneday77

High Jimmy.
Can you post and SoA from www.makesenseofcards.co.uk/soacalc.html please?
That way we can see your finances, advise on howe you could possibly cut back and increase your DMP. Don't worry it won't be a case of eat bread and water. The advice on here is always constructive, maybe no easy but always wise.

kez12

Hi Jimmy,

I have read your post and feel for you, unfortunatley unable to offer as good advice as some but You have come to the right place and will receive some good advice on here, everyone is here to look out for each other,

I wish you and your wife all the very best

savingmummy

Sorry to hear your struggling right now.
A SOA is a must, it is a clear layout which includes all the info needed. Make sure it is 100% accurate.
This forum is full of advise and fab people.
Goodluck.

JimmyRiddle_2

Here's a copy of My SOA as sugested - been totally honest with all the figures.

Bear In mind that the RBoS loan iis at interim charging order stage, and the 7500 MBNA is at Final Charging order stage

Statement of Affairs and Personal Balance Sheet
Household Information
Number of adults in household........... 2
Number of children in household......... 1
Number of cars owned.................... 2
Monthly Income Details
Monthly income after tax................ 1100
Partners monthly income after tax....... 500
Benefits................................ 250
Other income............................ 0
Total monthly income.................... 1850
Monthly Expense Details
Mortgage................................ 740
Secured/HP loan repayments.............. 0
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 120
Electricity............................. 44
Gas..................................... 80
Oil..................................... 0
Water rates............................. 35
Telephone (land line)................... 12
Mobile phone............................ 20
TV Licence.............................. 13
Satellite/Cable TV...................... 19
Internet Services....................... 28
Groceries etc. ......................... 250
Clothing................................ 20
Petrol/diesel........................... 150
Road tax................................ 20
Car Insurance........................... 50
Car maintenance (including MOT)......... 20
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 10
Pet insurance/vet bills................. 10
Buildings insurance..................... 10
Contents insurance...................... 10
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 5
Haircuts................................ 5
Entertainment........................... 0
Holiday................................. 0
Emergency fund.......................... 0
Total monthly expenses.................. 1671

Assets
Cash.................................... 0
House value (Gross)..................... 105000
Shares and bonds........................ 0
Car(s).................................. 3500
Other assets............................ 0
Total Assets............................ 108500

Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 128000...(740)......5.99
Total secured & HP debts...... 128000....-.........-
Unsecured Debts
Description....................Debt......Monthly...APR
barclaycard....................4900......0.........0
barclays bank loan.............4400......0.........0
Goldfish Credit Card...........1600......0.........0
Barclays Overdraft.............900.......0.........0
Barclays Overdraft.............100.......0.........0
RBoS Loan......................18000.....0.........0
MBNA card (Now C/o)............7500......0.........0
Haifax Card....................4300......0.........0
Barclays Overdraft.............500.......0.........0
Mint Card......................1800......0.........0
Barclaycard....................2200......0.........0
MBNA credit card...............6400......0.........0
Total unsecured debts..........52600.....0.........-

Monthly Budget Summary
Total monthly income.................... 1,850
Expenses (including HP & secured debts). 1,671
Available for debt repayments........... 179
Monthly UNsecured debt repayments....... 0
Amount left after debt repayments....... 179
Personal Balance Sheet Summary
Total assets (things you own)........... 108,500
Total HP & Secured debt................. -128,000
Total Unsecured debt.................... -52,600
Net Assets.............................. -72,100

Reproduced on Moneysavingexpert with permission, using IE browser.

JasX

I think I agree with the judge, go bankrupt, -> move into rented accomodation and wipe out the £72,000 you are overall underwater... other option is having virtually zero spare cash to live on for AT LEAST the next 10 years, not having any assets to show at the end of it and likely in that time any 'emergency' or hicup might well tip things over the edge and you'd be risking the house anyway.

After bankruptcy and without the debt you'd likely find even your curent reduced income level more than enough to rent a house worth 100,000k and live off without worrying about bills from month to month....

take proper advice and give that option some serious thought.....

LittleMissKitty

There does seem little to cut back on without just living off beans on toast, even then I'm not sure you'll find the spare you need to pay things off sooner rather than later. It depends whether you're willing to live like hermits for the next decade or if you would feel much better with a fresh start.

Personally I agree that giving bankruptcy serious thought may be your best option. You never know, it might well be the fresh new start you look back on as the day your life became your own again

Kitty x

JimmyRiddle_2

Thanks for all your shouts people.

Idealy want to avoid bankruptcy as we 'need' to stay in our current house. Not for pure selfish,'i must own my own home' reasons, but because of our daughter being accepted into the local school. In effect, if we go BR, lose the house, we would not be able to stay in the village (nothing come for rent in the past 2 yrs or so). Not living in the village would mean her not being able to attend the school (already oversubscribed) and would mean us moving away from the inlaws (not a bad thing I hear some of you thinking). The inlaws look after my daughter whilst my wife works, so we would be losing the valuable free childcare.

If it were not for the above reasons, we would have gone BR 2 yrs ago.

I'm trying to look into the DRO option (for my wife) as this would 'lighten the load' but seem to be going round in circles with regard to wether CCJ's and Charging Orders would be excluded from the £15,000 debt limit.

Plan of action would be to do this for my wife and then look at cca'ing some of my creditors to see if we can reduce my liability to under the £15k mark and follow up with the same course of action.

I know DRO's are viewed in the same light as BR, but at least we could keep life to a norm for our daughter. And at least the fee for 2 x DRO's (£190) is alot easier to find than 2 x BR's (£800).

elfieb

You cant do a DRO and own your own house.
You have to have less than £300 in assets, less than £50 surplus per month, and any car must be valued at less than £1000 on parkers website.

JamieT1977

can not much in the option of cutting current outgoings either, though £28 for internet seems steep.