Help should i go bankrupt??

ccqueen

Ok been a complete idiot and now really don't know what to do for the best, will keep it short and hope someone can advise me.

I have a few defaults on my credit file and one ccj for the tune of £8k (happy to take £50 a month at the moment)

I lost my main job in january so working part time and the council pay my rent at the moment as low earner. (just off JSA as doing over 16 hours a week now)

Main problem is i stupidly took out a logbook loan last year and now can't afford the repayments got a call this morning that the car will be repossesed. my mum took out a loan for the car for me and so i am paying her back monthly for it.

My other debts (in total £20k) including the ccj and logbook loan are mostly payday loans that have fallen behind. I'm not worried about them as they will all accept token payments if i get a dca involved.

The main problem is the logbook loan and now don't know whether to just let them take the car and keep paying my mum for it and let them chase the outstanding. and struggle on...

or...go bankrupt

problem is i earn roughly £450 a month and the car loan to mum is £230 if i go bankrupt and let lbl take the car will the bankrupcy sort the rest out?

or will i not be able to pay my mum what i owe her?

or do i try and sell the car and pay the loan off??

I'm really scared and got to find a solution now so sorry if this makes no sense but don't know what to do.

RAS

- Just checking -

Is the car on HP? Is the car in your name or mum's?

Is the loan in her sole name?

do you live with mum?

You will not be allowed to pay mum and not contribute towards other debts during bankruptcy. It is unclear if you would have an IPA.

Tixy

Hi

Do you mean your mum took out a loan to pay off logbookloans or she took out a loan originally when you bought the car?

How much do you owe your mum and is this included in the £20k?

Have you had any advice from any of the debt charities yet?

ccqueen

Hi sorry its unclear

my mum took out a loan in her name and i bought the car with it so no hp.

the amount i owe my mum is included in the £20k.

I just need to get rid of lbl as i am scared they will turn up and take the car and i'm stressed out.

i rent with friends so tempted to let them take the car and then just let them chase me for payment and go into a dmp to pay the rest off with my mum being the main one i pay and avoid bankruptcy.

however, if i do this i will also have to avoid my mum til i can get another car!

but is this better than going bankrupt?

Annisele

Have you sought advice from any of the debt counselling charities? The sticky on this site gives a list.

If you go bankrupt, then your mum will just count as one of your creditors - you wouldn't be allowed to 'prefer' her over the others.

How much is the logbook loan for? The example on their site gives an eye-watering APR of 437% - unless you've somehow managed to accumulate other debts with a higher APR, you should definitely pay that one off first if you can.

How much is your car worth? Do you need it to get to work?