Bankrupcy Advice

Kaleidoscope1972

I feel very sad to be posting this..but after some number crunching with my husband we have hit the realisation that our debts exceed our incomings:(...so Im guessing that BR is our only option...

however I have some questions..we privately rent and are worried how this will affect things as the advice I received from CAB was that we would be turned down for private renting in future..is this the case?..also Im a sole trader self employed would I have to cease trading?
Thanks in advance

what_happens_now?

Not sure about the trading question however when you try to rent property, most agencies will do a credit check on you, which for the near future, you will fail. But you can ask the agency if they will do bank reference check instead, this is a much more simplistic check to ensure you have a bank account and there if regular money going in. This you will pass (as long as you have money going in and out).

Kaleidoscope1972

We have had to move house 3 times in the last 16 months due to our rental periods ending rather abrubtly and have just found another property..although we are assured this is a long term let we are not taking anything for granted anymore and are assuming that we could be asked to move at anytime..something which I read on the BR website was that our LL would be informed which is worrying as they may serve us notice?

tigerfeet2006

There are plenty of people on here that have rented properties just before or after BR. Most go throgh a private landlord but others have managed to find LL who are willing to rent to them. Some may require 6 months rent up front or a guarantor though. It just takes patiance and perserverance.

As for being a sole trader, yes you can carry on trading. You bring your books up to date on you BR day and then start new books the next day.

dancingfairy

Do you mean your debts are larger than your salaries? or just that you can't afford to pay your debts each month? Anyway there are loads of options out there -not just bankruptcy - ie DMP, DRO,IVA, Bankruptcy etc - in fact bankruptcy is generally a last resort.
I would get in touch with one of the debt charities in Tigerfeets signature as a) they may suggest somethign other than bankruptcy and b) if bankruptcy is the best option you will be asked by the judge at the bankruptcy whether you have taken advice from a charity and understand the implications.
Good Luck
df

Kaleidoscope1972

no, our debts dont exceed our salaries but we have no disposable income left over after things like rent, food etc in order to make payments..my business is not exactly lucrative and I bring very little money in as I can only work 2 weekends a month due to child care..if I get lots of bookings in those weekends..I can make the payments..but mostly I cant..however I have never missed a payment and have an excellent credit score..we have begged and borrowed money to buy food in order to keep payments up:(

davidgmmafan

If you look at it from the landlords point of view you are allowed to include rent and other essential expenses in bankruptcy, so you have no debt and the money to pay the rent. That versus the effort of finding a new tenant. If they serve notice in bearing that in mind they're idiots IMO.

dancingfairy

Depending on your situtation the following options MAY (and I stress May because without all the info required it's hard to say for sure) be suitable:
a) a DRO - a mini form of bankruptcy for debts less than a certain amount (15k?) and if you are renting not a homeowner.
or
b) making token payments towards the debts for a period of time - perhaps only 1 pound per month if you think that the situation of not being able to pay anything towards you debt is temporary andthat you expect a change of fortunes in perhaps the next 6month to 1 year.
I still think that you need to have a chat with one of the debt charities - sometimes it helps to go through all the options and get a second opinion on things - other people spot things you might have missed etc.
Good Luck
df
P.S in terms of bankruptcy affecting your ability to rent it depends on your current landlords attitude and whether they find out - the Official Receiver may or may not tell them, also bankruptcy would obviously affect your credit file which would make it hard to rent through an agency once bankrupt so you would probably need a) 6 months rent as a deposit or b) a guarantor or c) to rent privately - but there are options.

Kaleidoscope1972

apologies for returning late to this thread..I have been intermittently without internet.

I have prepared a SOA..which really seems to indicate that bankruptcy is the only option..sadly we have discovered that should we go bankrupt my husband will lose his job, so we will be unable to pay rent on our property..after the stress of finding a new rental property (see seperate thread in Housing) I fear that if we go bankrupt we will end up in a worse situation than we are now.

I have sought advice from one of the debt charities who said a DMP might work for me if I think my business is going to pick up again.

One of the loans will finish in April 2011

The car is a lease car so we effectively rent it..so its not technically an asset

Statement of Affairs and Personal Balance Sheet

Household Information
Number of adults in household........... 2
Number of children in household......... 4
Number of cars owned.................... 1

Monthly Income Details
Monthly income after tax................ 660
Partners monthly income after tax....... 1700
Benefits................................ 150
Other income............................ 0
Total monthly income.................... 2510

Monthly Expense Details
Mortgage................................ 0
Secured/HP loan repayments.............. 0
Rent.................................... 650
Management charge (leasehold property).. 0
Council tax............................. 110
Electricity............................. 50
Gas..................................... 60
Oil..................................... 0
Water rates............................. 45
Telephone (land line)................... 18
Mobile phone............................ 30
TV Licence.............................. 12
Satellite/Cable TV...................... 14.99
Internet Services....................... 22.99
Groceries etc. ......................... 600
Clothing................................ 20
Petrol/diesel........................... 200
Road tax................................ 11.25
Car Insurance........................... 50
Car maintenance (including MOT)......... 20
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 0
Pet insurance/vet bills................. 0
Buildings insurance..................... 0
Contents insurance...................... 5
Life assurance ......................... 15
Other insurance......................... 0
Presents (birthday, christmas etc)...... 10
Haircuts................................ 25
Entertainment........................... 0
Holiday................................. 0
Emergency fund.......................... 0
Total monthly expenses.................. 1969.23


Assets
Cash.................................... 0
House value (Gross)..................... 0
Shares and bonds........................ 0
Car(s).................................. 14000
Other assets............................ 0
Total Assets............................ 14000

No Secured nor Hire Purchase Debts

Unsecured Debts
Description....................Debt......Monthly...APR
LLoyds TSB Loan................10........235.......17
Lombard Direct Loan............1500......154.......6
Natwest Loan...................4000......145.......8
Lease Car......................14000.....309.......NaN
LLoyds TSB Platinum C..........3500......140.......18
MBNA Credit Card...............2500......70........18.9
Total unsecured debts..........25510.....1053......-


Monthly Budget Summary
Total monthly income.................... 2,510
Expenses (including HP & secured debts). 1,969.23
Available for debt repayments........... 540.77
Monthly UNsecured debt repayments....... 1,053
Amount short for making debt repayments. -512.23

Personal Balance Sheet Summary
Total assets (things you own)........... 14,000
Total HP & Secured debt................. -0
Total Unsecured debt.................... -25,510
Net Assets.............................. -11,510

Created using the SOA calculator at www.makesenseofcards.com.
Reproduced on Moneysavingexpert with permission, using Firefox browser.

Kaleidoscope1972

I am worried sick about going bankrupt..we have a 5 month old baby and Im worried we will end up homeless...

tigerfeet2006

What is it your DH does for a job?

You may get help with rent and CT if your he loses his job. Pop your details in here and see what would happen if your DH was without work

www.entitledto.co.uk

Could you go BR and your DH go on a DMP or IVA? How are your debts split? His? Yours? Joint?