Help Needed!!

wynnvegas

Hi Folks,

My sister-in-law has an RBOS loan (initially £3,500, currently £3,900) with a debt management plan of £90 per month which, having recently lost her job, she is unable to pay. She lives with us but now has no income at all. I've advised her to contact some of the debt charities in the first instance but is there any possibility of her looking at bankruptcy as an option. She has no assets at all so this seems potentially the only option. My question is a) is bankruptcy the best option for her to get shot of the loan and b) if she does go down this route or chooses just to default the loan, is there any comeback on us with her living at our address?

Cheers,

Billy

bottleofred

Hi Billy,

Your sister in law should contact whoever the dmp is with and explain her circumstances to see what advice they suggest. She may well be better paying a token payment of £1 per month in the meantime, but someone with more knowledge than me will have other advice/ideas. Bankruptcy is something that many people consider, but she would probably have to pay for the privilege as the creditors rarely go for it as it costs them more money and they always hope to get some money back. Based on what you've said about her current financial arrangements, it's unlikely she'd have the money to go bankrupt. Bad debt normally only affects the individual and not the address.

wynnvegas

Thanks for the reply. I'll get her to call the relevant people tomorrow. Looking at DRO at the moment but she's in Scotland so not sure if there's an equivalent option. We'd happily stump up the £90 or £500 to help her out of her situation if that was the best option.

Cheers,

Billy

pipsi_2

I think in her case she would be better offering a token payment until she gets a job and can afford to pay a little more. Bankruptcy will have a terrible effect on her credit rating and although making an arrangement with RBOS will affect her credit rating it won't be as bad as bankruptcy. It is up to her however but that's what i would to if i were in her situation.

Hannah_10

Bankruptcy for £3,900 does not strike me as a good option.

A far better idea would be her calling National Debtline and finding out how to make token £1 a month payments until her situation improves.

If her DMP is through any third party but a charity then she should ditch them and do it herself anyway.

MrsTinks

I'm going to agree that £3900 is a small debt to go BR for - HOWEVER there are other factors you may want to consider... is the debt having a seriously negative impact on her health? Would a fresh start prevent possible depression etc?
I'm not up on scottish BR etc I'm afraid - but no doubt others will help with that if you ask on the BR board

wynnvegas

Thanks for the help folks. She's looking at the token payment route as a first option.

Cheers,

Billy