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Bankruptcy - yes or no?

yeovilmac
Posts: 397 Forumite
I am finally coming to terms that maybe the big "B" is what I should go for. I am a client of the CCCS and have taken their advice but I would really appreciate the views of forumers too.
I have £11,886 of personal debt. This is made up with £5k on a Welcome loan, £2,750 Abbey o/d, £1,500 unpaid tax bill, £1,095 Telewest cable bill, £600 BT unpaid bill and some smaller debts.
I am a self employed courier and I have also built up £3,894 of business debt, predominantly £1,600 startup loan, £700 VAT bill, £940 fuel bills and a couple of small ones. Due to business falling away, I have no more than £50 a month to pay ALL this off, meaning I won't be debt free for more than 20 years...
I have pared back all that I can. I rent a flat for £130 a week which includes council tax, electric, gas and water as well. This is cheap in Bristol, I can assure you. I have two split families which I pay maintenance of £30 a week total towards. I don't drink, smoke or take drugs and I socialise by going to football once a month. The company has no assets at all, as the car is leased and there are no premises or stock.
I am worried about the future. I cannot slip behind any further with my rent as my very patient landlord will turn. Business always picks up in March / April every year.
The CCCS sent me some info on bankruptcy and it looks like I could startup again in a smaller way once my bankruptcy has been approved. Do you think this might be the way forward for me. I would really appreciate any views, even the ones that say I have been an idiot for getting into this mess. Please help me as I could really use some decent info and I have seen some great replies on here to other threads.
Bless you for reading this far.
Martin
I have £11,886 of personal debt. This is made up with £5k on a Welcome loan, £2,750 Abbey o/d, £1,500 unpaid tax bill, £1,095 Telewest cable bill, £600 BT unpaid bill and some smaller debts.
I am a self employed courier and I have also built up £3,894 of business debt, predominantly £1,600 startup loan, £700 VAT bill, £940 fuel bills and a couple of small ones. Due to business falling away, I have no more than £50 a month to pay ALL this off, meaning I won't be debt free for more than 20 years...
I have pared back all that I can. I rent a flat for £130 a week which includes council tax, electric, gas and water as well. This is cheap in Bristol, I can assure you. I have two split families which I pay maintenance of £30 a week total towards. I don't drink, smoke or take drugs and I socialise by going to football once a month. The company has no assets at all, as the car is leased and there are no premises or stock.
I am worried about the future. I cannot slip behind any further with my rent as my very patient landlord will turn. Business always picks up in March / April every year.
The CCCS sent me some info on bankruptcy and it looks like I could startup again in a smaller way once my bankruptcy has been approved. Do you think this might be the way forward for me. I would really appreciate any views, even the ones that say I have been an idiot for getting into this mess. Please help me as I could really use some decent info and I have seen some great replies on here to other threads.
Bless you for reading this far.
Martin
0
Comments
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There's straight forward information about Bankruptcy here
http://www.nationaldebtline.co.uk/england_factsheets/factsheet_01.php3
The Bankruptcy law has been changed recently, so that those who are genuinely in real difficulty should find the process easier and get discharged more quickly - often inside 12 months!
Posters on other sites have found that the court officials and Official Receivers are kind and understanding and simply want to their job efficiently ... which would help you, as the more efficient they are, the easier the process is likely to be.
Try a search on Bankruptcy on The Motley Fool Debt Board here
http://boards.fool.co.uk/Messages.asp?mid=9081884&bid=50079
In particular, look for messages on Bankruptcy posted by Beeshooter.
Your situation is impossible and you have all my sympathies. If it were me, I'd do the big B. Things can only improve once you are debt-free. You have to be sure it's the right thing for you, however, so continue to research and then make your decision.
Very best of luckWarning ..... I'm a peri-menopausal axe-wielding maniac0 -
Thanks, Debt Free Chick, or may I call you....D!
Just the sort of post an old fool like me needs to study.
LOL
Martin0 -
Just a quick question about my fathers situation. he's Terminally ill and hence he is having to declare himself bankrupt.
Basically should he try and sell whatever he can, (his car etc) before he becomes bankrupt? Obviously not his house, but little things.
edit nm as the information was in the link and it turned out to be the link I was loooking for in my emails anyway.0 -
Please be aware that declaring yourself bankrupt will mean you lose a few things which some peopel woudl consider relatively unimportant.
For example you won't be able to become a member of the houses of partliament, although I'm sure that's not high on your list of priorities. There are some others but I'm having problems getting into my email account to retrieve the document.
Walla email is so bad these days. https://www.walla.com . Often down, slow and emails sometimes take ages to arrive. Added to this they almost forgot to renew their URL. Gmail all the way.0 -
Just had a call from HM Customs And Excise...
He says that as I'm a sole proprietor, they have the power to come in and take things like my tv etc. They are considering winding up my company soon and theres a thought that I should let them do it as it would save me the £450 I would have to lodge with the court..
He would rather come to an arrangement over the £700 I owe them but to be honest I'm sick of the whole thing now and its tempting to let them get on with it...0 -
the only way to keep your property is to sell it to someone for "real" price. Meaning a 2nd hand TV is probably worth say £80 so tell them you sold it to a mate for £80 - get somoene to sign something saying that they lent it back to you but they own it and that way the Customs people cant take the TV.
This is only an example and can generally be applied to most things that you own (you say that you dont own a house so thats the big thing out of the way!).
Car is slightly more difficult but as you are a courier this is needed for your work. You are allowed, under bankrutpcy laws to keep those things necessary for work - otherwise you would never be able to get an income again. The court allows you enough to live and work, so you can earn enough to eat, cover rent, electricity etc BEFORE you have to make any contribution to the court to pay off your creditors (those you owe money to).
If you want any further advice email me (I'm a lawyer and one of my areas is personal and company liquidation and administration!!).
Hope this helps you a little and best of luck0 -
yeovilmac wrote:Thanks, Debt Free Chick, or may I call you....D!
Of course you may - saves on the old finger tapping.
Some posters have found my Username a little ... erm ... inappropriate. May I just say that I am not smug about being debt-free, just bl00dy relieved. I've done all the usual stuff ... £30k on credit cards, consolidation loans, extended the mortgage ... all of it! I'm debt-free now only having learned hard lessons and doing the research. As I say, just relieved, not smug - and truly concerned & keen to help with those who are still treading the treacle.Just the sort of post an old fool like me needs to study.
LOL
Martin
I'm not so young myself (fully paid up member of the Grumpy Old Git club - and proud of it!).
Experience is nothing to do with age .. .so I like to think.
Kind regards - thanks for your message :-)Warning ..... I'm a peri-menopausal axe-wielding maniac0 -
Please dont take this the worng way... my partner got into lots of mess trying to start business's, to get out of the debt he had to shut everything down and not do anything and just get a regular job. You say that if you get rid of the debt, you would start up something smaller again. I suggest that until you feel confident budgeting and living within your means again, you could consider getting a regular paid job. You would have less worry, and would just have to turn up on time, and get paid at the end of the month. If you did want to do your own thing you could save up some money to do it with. It is alot harder spending money you have saved, than spending a loan. I don't want to make you feel bad and I hope that everything works out for you. Living without debt will really improve your quality of life. Good Luck. Oh and keep posting - you will get lots of help.0
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Go and have a look at the debthelpuk forums. It's very helpful there and there's lots of people who have gone bankrupt so they have lots of experience. Just ignore all the trolls that tend to descend on the place every now and again! Good luck!0
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Phonix wrote:Just a quick question about my fathers situation. he's Terminally ill and hence he is having to declare himself bankrupt.
Basically should he try and sell whatever he can, (his car etc) before he becomes bankrupt? Obviously not his house, but little things.
edit nm as the information was in the link and it turned out to be the link I was loooking for in my emails anyway.
My sympathies for having both issues to deal with at the same time. What I'm about to suggest is going to seem horribly insensitive, but I hope you will see that I'm trying to look at some of the practicalities.
The main thing to bear in mind is that, on death, debts are dealt with by the executors as part of the process of dealing with the estate and the will. Debts cannot be inherited. On death, one would generally have some assets e.g. house, jewellery, other stuff of value. The job of the executors is realise the assets, usually by selling them, and then to pay the debts and distribute the residual estate to those named in the will.
If you do nothing, then your father's debts will be dealt with this way on his death. I can't see anything to be gained by declaring bankruptcy now and the whole process might be complicated if he were to die before the bankruptcy is discharged. I would be inclined to negotiate with his creditors. By this, I mean that you should write to each of them and inform them of his current state of health. I would not emphasise the terminal nature of his illness ... just send them a financial statement showing his income & expenses and make an affordable offer to pay each creditor £x per month. There's great information on this on the National Debtline website, under the Self-Help Pack at the bottom of the page, available here
http://www.nationaldebtline.co.uk/england_factsheets/debt_advice_england_wales.php3Basically should he try and sell whatever he can, (his car etc) before he becomes bankrupt? Obviously not his house, but little things.
Not sure that this will really help. If he sells stuff and uses the money to pay some of his debts, then I don't see that he could be criticised/penalised. However, if he deliberately tries to deprive himself of valuable assets then I think he could be penalised - especially if he does not use the proceeds to reduce his debt. He may be accused of being reckless/irresponsible and that could have an impact on any bankruptcy application.
Also ... if he does go the bankruptcy route, then his house will almost certainly be seized anyway - along with all other assets. So he is only trying to put off or pre-empt what is inevitable, should he go bankrupt. But I don't think that bankruptcy is a sensible option anyway, as I've said above.
To confirm. My suggestion is that you negotiate a sensible, affordable repayment plan with his creditors. This could take months, but should result in them accepting that he can only pay what he can afford, even if that's only £1 a month!
Then, take care of your father and make his last months as comfortable and stress-free as can be expected, given the circumstances. Defer dealing with the crap until the inevitable happens. You will have the strength to sort it all out then ... don't waste what little time you have left with such unimportant issues. It's only money and they (his creditors) can't take what he doesn't have. Sod 'em! Let your father be your priority for now.
You can always call the National Debtline for more specific advice on any debt-related issued. They're a charity whose aim it is to help people just like your father.
Wishing you luck, strength and as much as you can get from your father's remaining months. A very awful situation. I have you in my thoughts right now.
I do hope this helps.Warning ..... I'm a peri-menopausal axe-wielding maniac0
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