Bankrupcy Advice

tigerfeet2006

Kaleidoscope1972 wrote: »

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 Put with phone. Max. £60
TV Licence.............................. 12
Satellite/Cable TV...................... 14.99 Not allowed on your SoA. Must come from surplus income.
Internet Services....................... 22.99 Ditto unless needed for work or study.
Groceries etc. ......................... 600 £700
Clothing................................ 20 £150
Petrol/diesel........................... 200 Keep reciepts to prove usage to the OR as this is quite high
Road tax................................ 11.25
Car Insurance........................... 50
Car maintenance (including MOT)......... 20 £30
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 0 £5 per week per child for activities. £2 PRIMARY SCHOOL DINNERS PER DAY £3 Seconadary.
Medical (prescriptions, dentist etc).... 0 £25
Pet insurance/vet bills................. 0 Any pets?
Buildings insurance..................... 0
Contents insurance...................... 5 is it really this low? Does it include accidental damage?
Life assurance ......................... 15 The OR may have an interest in this.
Other insurance......................... 0
Presents (birthday, christmas etc)...... 10 Most OR's won't allow.
Haircuts................................ 25 £40
Entertainment........................... 0
Holiday................................. 0 £100
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.

Some figures to play with if you were to go BR.

You don't show the lease amount on your SoA.

Kaleidoscope1972

the debts are split fairly equally between us..

we both feel ill..the debts are ones which we carried over from our house sale due to negative equity..we got into financial problems because I became seriously about 6 years ago..was unable to work and ended up living off credit...

my husband has become seriously depressed and Im now worried about him..we sold our house 18 months ago to try and pay debts off but were unable to clear all of them due to the house being in negative equity..to make matters worse..we had to leave each property after a short spell of a few months so ended up having to borrow to pay moving expenses, rent in advance etc..

Tomorrow we are moving into a tiny house with a lower rent and could not go any cheaper...the house we were living in was owned by my husbands employers and after telling us it was a long term let..they have put it on the market..they have loaned us the advance rent and man and van cost but are deducting it from my husbands salary over ten months..something which will push our income down even more..we literally cant afford to eat..

Husband works in retail management so they are not going to want a bankrupt doing that job..

the car is on lease..if we go bankrupt we will obviously lose that..which means that I wouldnt even be able to go to work myself

Kaleidoscope1972

Thanks..I showed the car lease in unsecured debts....yep contents insurance is that low!

Internet I have to have for my business..the car usage is actually higher Husband works ten miles away so does 40 miles a day just going to work, we clocked usage and watched it carefully and worked out that on the occasions I have bookings..we are putting over £200 a month in it (its a diesel 1.9)

unfortunately Im stuck in acontract on the phone until next April..but will be getting rid and going onto PAYG

We are also tied into a contract with the internet and tv service..all come from Bt which we took out when we moved in here their terms are minimum 12 month contract..I would get rid if I could

Kaleidoscope1972

not sure what else to do..I have tried to get in touch with CCS, but their office is closed and National Debtline have a recorded message saying they are too busy to answer calls...

I cant seem to get any further advice so will file for bankruptcy..My husband has had it confirmed today after speaking with head office that he will lose his job

dancingfairy

Why can't you do a debt management plan for now? this may buy you some time so husband can look for a new job? You have 500 a month to split between your creditors so it's definitately doable - it will take some time to pay back but when the children are a little older hopefully you can work more hours etc - your husband may get a pay rise etc.
I'm not sure that going bankrupt knowing your husband will loose his job without knowing what benefits you will get is a good idea to be honest.
Good Luck
df

Kaleidoscope1972

Ive phoned Debt Free Direct and they have advised an IVA as they say we do have money to split between creditors so its the better option..we can keep our car..I feel incredibly releived..if not a little sad and ashamed..sadly things were ok until my business started making less money..then it hit hard

Gary73

I was moved enough by your circumstances to post to you. I want you to know that there is no shame in entering into an IVA or Bankruptcy.
I've been there and come through the grey clouds to blue skies. It ain't easy but I guess you will already know that.
I entered into an IVA in 1996 and am pleased that I did. I paid back a higher percentage than usual of my debt. After 5 years the payments ceased and I was able to come to an agreement with my bank( RBS) which enabled me to obtain a bank loan and credit.
This was due to the fact that I ensured I ran my bank and mortgage accounts properly during the term of the IVA.
I understand that normally you will find it hard to obtain further credit for a set time after the completion of the IVA but my experience shows it is possible if you have an understanding bank.
I chose not to tell my employer about the IVA and believe I was not under obligation to do so.
As the term of my IVA progressed my situation improved and life became much easier.
At the conclusion of it I was so much better at handling my finances that life became a breeze.
We too had young children and you find that as they get older things become better.
I hope you can read this and take something posistive from it.
Believe it or not, entering into an IVA gave me a number of positives and the experience has stood me well over the past few years.
I say go for it and keep on working hard and you too will see those blue skies in the not too distant future.
Good Luck.

Kaleidoscope1972

Thank you Gary...I really appreciate your post..

Weve been advised to open a new basic bank account and as you said..we dont really need to divulge our IVA to anyone..weve learnt the hard way that finacial trouble is not solved by more credit

dancingfairy

o.k a couple of things:
1) yep - you definitely should get a new bank account
2) the advice you've been given worried me - a) because I've not heard of Debt Free Direct and I am concerned that they have 'sold' you an IVA rather than it necceassrily being in your best interests and also b) an IVA is a form of insolvency so your husband may well still loose his job and c) you don't have a house or anything like that to protect which is what normally IVA's are for I beleive if you have equity or assets so
based on that I don't think an IVA is necessarily the right option - sorry.
Please have a look at the top of the board on here - there is a link to where to get advice - you really need to get some free and impartial advice - there are other places besides the ones you've tried.
Good Luck
df

philnicandamy

Debt free direct ? not a barge pole big enough to touch them...sharks best avioded..fair few stories in the past about their "helpful tactics" and someone will be along to correct me but they're one of the companies currently under investigation by the goverment for their "selling tactics"

IF your considering an IVA then look at cccs or payplan..at least with them your guaranteed payments go to creditors NOT to their pockets like DFD and many more od the shonky outfits thinking IVA are a good way to line their pockets