The Bankruptcy Club & Supporters Club

sandralovescats

Doushka, it says

"State pensions, like other state benefits and allowances, do not form part of the bankrupt’s estate. "


They are NOT allowed to take any part of your DLA, that is the law. Your IB cannot be touched either.

The issue would be with your IPP

bloomin_freezing

Hi Doushka,

Yes it was all quite straight forward, not daunting at all believe it or not! Will have the OR call after Christmas, all tips/advice gratefully received!

sandralovescats

The news today is that from the end of the month there are to be changes


Just read this of Newcastle Welfare Rights website...

Not sure who the lenders extend to, Credit Unions are one.. does say 'not for profit' lenders..but then it says those who subscribe to the Banking Code...

Possibly need to ensure if you are on benefits, that the creditors do not have benefit details or NINO..


Debts can be recovered from benefits
From 27 December, certain debts can be repaid out of someone’s benefit.

Called “the Eligible Loan Scheme”, the DWP can make deductions from someone’s benefit where they have defaulted on loan repayments to “not for profit” lenders.

They include Credit Unions and others who have a good banking record and not lenders who have higher charges and those who can use effective recovery methods. There will be a “memorandum of understanding” between the DWP and lenders who belong to the Banking Code.

Recovery can be from: Income Support, Pension Credit, Jobseekers Allowance, Incapacity Benefit, Retirement Pension and Carers Allowance (note the addition of non means tested benefits).

The main rules are:

The claimant has failed to make agreed payments for 13 weeks before the date of the application and has not resumed making payments. This is supposed to give them time to sort something out with the lender
The claimant has agreed the lender can give his/her details to the DWP
Interest and other charge will frozen at the date of the application
There are no existing deductions for overpayments, social fund loans or another debt under this scheme
There will be no deductions if there is a dispute about the amount
The loan must have been a personal unsecured cash loan, not from a credit card or business loan
The rate of deduction will be similar to other deductions, like rent arrears, but will have a lower priority if there is more than one deduction

The good news is that the deductions are capped at £2.27 per week.

The Statutory Instrument governing this can be found at:

http://www.opsi.gov.uk/SI/si2006/20063188.htm





Prior to 27th December they were not allowed to take ONE PENNY from State Benefit payments.

sandralovescats

Doushka wrote:

however, I think this is what you/I/we were looking for

http://www.insolvency.gov.uk/freedomofinformation/technical/techmanvol1/Ch25-36/Chapter31/part5/part2/part_2.htm

31.5.17 State benefits

In the majority of cases state benefits will not vest in the trustee. The Social Security Administration Act 1992 section 187 provides that benefit as defined in the Contributions and Benefits Act 1992 section 122, any income related benefit or child benefit shall not pass to any trustee or other person acting on behalf of the beneficiary’s creditors on the bankruptcy of the beneficiary. In practice this definition of benefits is wide enough to cover all benefits likely to be encountered, excluding only "Old Cases" benefits. "Old Cases" benefits are allowances and benefits payable in respect of industrial diseases and workmen’s compensation under the Workmen’s Compensation Acts.


now is this confirming what you said sandra? sorry, my brain just will not comprehend but I need to get it sorted and my letter off to that daft woman

YES!!

I knew I had read that somewhere!

I knew that the OR couldn't take any of it. Now you have the proof you need.

desmonds

sandralovescats wrote:

YES!!

I knew I had read that somewhere!

I knew that the OR couldn't take any of it. Now you have the proof you need.

I am Bankrupt and work full time. My wife is a full time Mum and she gets Child Tax Credits and Child Benefit.

The Income and expenditure calculation that the Or has come to to form part of an IPA includeds not only my income but the child tax credits and child benefit/

I mentioned to the OR that as a matter of public policy state benefits cannot be used to form part of an IPA.

I was told that that I was the Bankrupt and not my wife so in that case it did not apply.

Is this correct what they are trying to do?

If so, does that mean that if the tax credits and child benefit had been in my name instead of my wifes then they could not have used them to form part of an IPA.

It seems like a technicality because if I phoned DWP and changed the beneficiary to me instead of my wife then they could not touch the benefits.

desmonds

sandralovescats

desmonds wrote:

I am Bankrupt and work full time. My wife is a full time Mum and she gets Child Tax Credits and Child Benefit.

The Income and expenditure calculation that the Or has come to to form part of an IPA includeds not only my income but the child tax credits and child benefit/

I mentioned to the OR that as a matter of public policy state benefits cannot be used to form part of an IPA.

I was told that that I was the Bankrupt and not my wife so in that case it did not apply.

Is this correct what they are trying to do?

If so, does that mean that if the tax credits and child benefit had been in my name instead of my wifes then they could not have used them to form part of an IPA.

It seems like a technicality because if I phoned DWP and changed the beneficiary to me instead of my wife then they could not touch the benefits.

desmonds

This does not sound correct to me at all!

If you are the bankrupt and went bankrupt as an individual and the Benefits are in your wife's name, why is the OR including HER supposed income in YOUR bankruptcy? Does your wife work? Have they also included her earnings in the calculations?

desmonds

sandralovescats wrote:

This does not sound correct to me at all!

If you are the bankrupt and went bankrupt as an individual and the Benefits are in your wife's name, why is the OR including HER supposed income in YOUR bankruptcy? Does your wife work? Have they also included her earnings in the calculations?

Hi

My wife has no earnings. The only money she gets is child benefit and child tax credits based on my income.

My wife is a full time mum.

The OR has split the household expenditure down the middle and in doing so has included these child benefits and tax credits.

So the mortgage, council tax etc etc is split down the middle so although my wife has no way of paying her half apart an IPA has been decided.

The OR has added my income of £1500 and my wife's benefits which is about £500 based on my last years earnings.

So they are using a total monthly income of £2000 and have come up with a an IPA figure of £170 per month for 3 years.

It states on the Insolvency website that as a matter of public policy state benefit cannot be used to form part of an IPA which is what they are doing.

What can I do?

Desmonds

desmonds

I have had two independent valuations on my home.

The valuations have come in at:-

1. £350K-£365K
2. £360K-£375K

Can anybody tell me what figure the OR will come to?

Will he average the figures to £362.50K?

The total mortgage outstanding is £357K and my wife has no part in the Bankruptcy.

So can I assume that if they use the average figure then that will leave £5500 equity of which 50% of my share in the property is £2750.

Would that be a reasonable figure a third party to pay to buy my beneficial interest from the OR.

Desmonds

smokey112

desmonds wrote:

I have had two independent valuations on my home.

The valuations have come in at:-

1. £350K-£365K
2. £360K-£375K

Can anybody tell me what figure the OR will come to?

Will he average the figures to £362.50K?

The total mortgage outstanding is £357K and my wife has no part in the Bankruptcy.

So can I assume that if they use the average figure then that will leave £5500 equity of which 50% of my share in the property is £2750.

Would that be a reasonable figure a third party to pay to buy my beneficial interest from the OR.

Desmonds

Desmonds

You may be able to "debate" the figure lower with your OR - once you point out the OR legal costs etc , things maybe needing doing to the house you could get the figure lower to a nominal sum of say £500 - I am sure there are some posts on this somewhere - I will check another forum for you and get some tips from there

My OH had this done with the property which he is still named on the mortgage of although he has not lived there for nearly 15 years - his ex was taking so long with divorce etc it seemed that the OR was interested in his alleged £25k interest - we got this down to £500 with debating and a little bit of earache from his ex to the OR.

HTH

Ang
x

desmonds

Hi Ang,

Am I correct that any equityin the house less than £1000 pounds the OR has no interest in the property?

I have been advised to sort the house out straightaway and not leave it to gain any equity.

The OR is keeping very quite and I suspect that they are hoping that in 2-3 years time befire the IPA ends they may revalue the house and wallop me for any additional equity.

At the moment there is hardly anything in equity and now is the best time for my wife to buy my interest.

So you reckon this £2750 could be eaten up further which would leave nearly nothing.

Keep the advise coming please

Desmonds