Done something unforgivable resulting in £207,000 debt

pete456_2

Hello everyone..... my light bulb moment came very late but here I am starting to deal with the nightmare that I have created. You don't need to be gentle, I've well and truly messed up on so many levels but now I really need to take responsibility for what I have done a deal with it.

Long stort short..... I'm 33 years old and in debt just over £207,000.

It's a bit complicated but here's the breakdown.

£18,218 Unsecured Loan
£49,727 Credit Cards
£140,000 My poor unsuspecting father !

How have I done this? Good question. The loans and the credit cards are shall we say "typical" borrowings. I've run up these bills buy financing a start up company and general living expenses.

The huge debt to my father was a temporary loan......problem is, he doesn't know about it ! :eek:

Let me explain.....

He gave me the money to invest for him split safely over several bank accounts as Martyn suggested on MSE. I'm so ashamed but when my company ran into trouble over the last year, I have used this "fund" to cover me .....and now it's all gone. I can't believe I did it but I was desperate and the money was just sitting there earning a few percent interest. I thought I could utilise it and create a better return for him and me by investing it in my company. It was a risk and it wasn't my money to risk but at the time I was confident in my ability and took a gamble.

It hasn't quite worked out and it's been a very tricky year and so I have since closed the company but I have at least generated pretty much the same amount back. I'm maybe 15k short, not including the interest he would have earnt had I left it in a savings account.

So I can replace his money without him knowing which is my priority but it will leave me with nothing. No company, no income, no home. I rent at the moment but can't afford to continue so will be breaking my tenancy agreement and moving out in a few weeks.

My first priority is paying the money back into the account for my dad, however I still have £67,000 worth of loans and credit cards bills to pay with no income to pay them.

I've no idea where to start. I feel like paying back my dad and jumping on a plane and start again somewhere else but I know that's not the answer and would like to clear up this mess.

I'm scared of bankruptcy. Is there another way? If I go bankrupt, will they take the money in my name that is really my dads? ....would it be sufficient to show them that I owed it to him or would my card and bank debts take priority over him and take it?

I do have shares which pay dividends of circa £4000 per year. If I sold them I could raise 20k approximately. I could put this towards the credit card debt but then I really will have nothing to live on. If I went bankrupt I trust they will take these shares off me?

It's a real mess. I want a business again so I feel like I need to hang onto any money I have... but I also don't want this debt hanging over me. I will clear my dad's debt, I couldn't forgive myself if I didn't. In the meantime I need an income but jobs will be tricky having been self employed and no CV to speak of. Oh dear....bit of a disaster really

Any advice would be appreciated.
Thanks :embarasse

NGlady

Hi, can't be much help really, but what everybody will ask for on here is a SOA (statement of affairs i believe) this willl allow people to see where your money is going, the interest on things and try and help you find places to cut.
Good luck!

DarkConvict

Dont want to read and run. It is good you are finally taking responsibility are some very irresponsible actions.

If you have got his money back, you need to pay him back and tell him what you have done. As you had permission to put his money in savings accounts not an investment business it could be seen as fraud, or even theft as it was your business.

As to the credit cards/loan, if they are pre april 2007, check for enforceability to buy sometime - http://forums.moneysavingexpert.com/showthread.html?p=26867731#post26867731

I will be blunt here as i am running off, if you have come out from a business with nothing, then so be it this is the risk of running a business, many people come out eye balled in debt they have to go bankrupt.
Read the sticky topic about SOA, and post up your SOA in MSE format.

Woowoo

Hi Pete456

Have just sat here with my mouth wide open reading your post!

When you pay the money back to your dad, is that going into an account in his name?

Pay him back as soon as possible before considering going bankrupt, you cant risk losing his money and leaving him in a position as bad as your own.

I hope you feel a little better for confessing to someone at least, even if you can't tell you dad.

Good luck

not_tonight_josephine_2

Please look into things very carefully before thinking of bankruptcy, as i understand it you are not allowed to give preferential treatment to one creditor above another if you're going to go bankrupt, so you may not be allowed to pay your Dad back?

If you have enough money to pay your Dad back as you say, then the amount of debt you're left with can be managed - many people on here deal with similar levels of debt. Post up an SOA as suggested and good luck

metalfury

Well done on taking the step to improving your situation.

Paying back you Father ASAP would be my priority. I don't know what your relationship is like with your father, but I'd consider paying him back what you have to date (£125K? or the 140K in full) and coming clean with him. Even though he will of lost on the interest at least it won't be there as a temptation for you to use again.

Put up your SOA, there maybe some juggling that can be done and you maybe able to shift some of the credit cards around to reduce the intrest payments.

Maybe make a job of securing a job. i.e. start at 9 and finish at 5 with a schedule for the day. At 33 and self employed you will have lots of experience and skills for your CV. At least with some money coming in you can start making inroads to the debt or pay the rent.

Best of luck and be positive.

pete456_2

DarkConvict,... do I really need to tell him? As far as he will know the money won't have moved. It went out but it will go back in. It may not have all the interest I suggested but I will try and top it up so he has made some money on it.

Woowoo..... I know, pretty shocking isn't it. but I'm going to fix it somehow. At the moment the money would go back into savings accounts in my name. He hasn't asked for it back but he could do at anytime I guess. Either way I need to be in the position to transfer it back to him when he asks... not say, "sorry dad, I've spent it".

If I end up becoming bankrupt then yes I will transfer the money back to him first. I want to honour my debts with the banks / credit cards but obviously my father comes first.

I will do a SOA. Thanks guys.

claudia123

Hi Pete456


We could all sit here and think jesus christ what the hell have you done but that wont help and we are all on here because we need help

I too would come clean with your dad and give him the money back you owe him ...im sure if he loves you he will understand you were desperate. He will maybe be able to help you out of your current situation.,.....but please DO

muskoka

I don't see why you cant have forms sent to him for opening new account/s and when he queries it, just say your business was/is in trouble and you need to get the money back in his name.......then you can't be tempted to spend it again.

claudia123

Hi Pete456


We could all sit here and think jesus christ what the hell have you done but that wont help and we are all on here because we need help

I too would come clean with your dad and give him the money back you owe him ...im sure if he loves you he will understand you were desperate. He will maybe be able to help you out of your current situation.,.....but please DO NOT GO BANKRUPT before you have paid your dad back and i would also wait a while before you do anything in case they are allowed to take if off you......
We all make mistakes....i too am in about £100k debt so i know how it feels


Hope this helps

:rotfl:

maysmummy

I would also say tell dad. Have the cheque for as near to 100% of the money in your hand as you do so. Although you have broken his trust and used his money without his permission at least you haven't done a Nick Leeson and lost the lot.:eek:

I expect that he will forgive you and if he does not, at least he won't be able to go to the police as you have given him the money back(sorry)

then concentrate on paying back your other creditors. Look on the forum at debt counselling services like CCCS and post your SOA online.

Please come back and tell us how you get on.You may need emergency choccy biccies.

HTH
MM