My Bankruptcy Story

the_bright_side

Hello to you all.

I thought I would tell you my story, if it make 1 person feel better it is worth the while.

I left school at 16 and joined HM Forces, after 10 years service I left the Army and started an IT consultancy. In 1996 the business premises we shared with two other companies had a severe fire due to faulty electricity distribution board and it took nearly 12 months for the insurance to settle the claim. In the meantime the business ceased trading and as I had guaranteed a business loan, I was made bankrupt by the bank for less than £21K. In 1996 the banks seemed so much more aggressive about loan repayments.

We didn’t loose the family home as at the time the equity was less than £1000, which my wife purchased from the O/R

For the next 12 years we built up a new successful and thriving IT consultancy. I had a very comfortable life, with a nice house in the UK, a property portfolio of property in Spain, nice cars, foreign holidays and most importantly my marriage of 25 years, my gorgeous children and my health.

Then in 2007 it seemed to change, literally overnight, the business started to lose clients and invoices were not being paid by our customers, the foreign mortgages rates were increased, the rental potential on the foreign properties halved and the business running costs became higher.

Then in late 2007 the foreign banks foreclosed on one then the remaining mortgages, the majority of which were in my wife’s name, this culminated in my wife going bankrupt in 2007. At this point we lost our family home and moved into rented accommodation.

Since 2007 we have down sized everything, I have reduced my personal lending and have fought to keep the business going, all this to the detriment of my marriage, my health and the relationship with my children, the stress has been immense and I know I have been an absolute nightmare to live with. Then when things started to look up, 2 months ago our biggest client went bankrupt and due to the lack of cash flow our business became insolvent with me owing the business a substantial amount in the form of a directors loan.

So now my wife is a discharged bankrupt, my business is now bankrupt I am a discharged bankrupt (albeit 15 years ago) now owing a substantial amount to HMRC and deciding whether I should either go either bankrupt for the 2nd time personally or enter into an IVA.

Both have pro’s and con’s. If I go bankrupt I can start again at the age of 39, however in my industry this may make it hard for me to be employed.

If I go into an IVA I will be able to pay some of my debts back and not be bankrupt, however I will be paying for the next 5 years and again an IVA will may make it difficult to obtain employment.

I have to make a decision in the next few weeks.

However I will base my decision on what is most important to me and my family, this may sound selfish but my health and wellbeing is far more important than my creditors as I have a wife and children to look after.

I may not have the cars, the houses or the business, but I have them.

It’s going to be hard over the next few months, however to all those that are thinking of going BR, I came back from Bankruptcy once, and even with the multiple bankruptcies I intend to try and fight back once again and hopefully start afresh.

To those who are thinking of BR, please think of your health and sanity before everything else.

I know there are going to be those that say pay your creditors off. However if most of your creditors are Credit Cards / banks or finance companies, I think what goes around comes around.

Please feel to PM me if you want to ask me questions.

Sunnylooloo

Wow.............. what can i say you name says it all huh.

I think what are saying is so true about your health and your family.

good luck and I'm sorry that things have been rubbish for you you really deserve a break

take care
LL

leveller2911

Personally I have a lot of sympathy at the beginning of your post , severe fire etc and losing the business the first time.Ive seen this locally and its heartbreaking to see people who have struggled to start and run a business only to have it taken away by a fire or clients owing them money.Having been in business for over 20 years and people owing me money ,but luckily its never been enough to take me under.There but for the Grace of God go I.


"For the next 12 years we built up a new successful and thriving IT consultancy. I had a very comfortable life, with a nice house in the UK, a property portfolio of property in Spain, nice cars, foreign holidays and most importantly my marriage of 25 years, my gorgeous children and my health."

Just my opinion but the above statement is where you lose my sympathy.Why couldn't you just be happy with one house and a loving family.

Having a "Property portfolio" in Spain was just greed, why didn't you save for your luxurious lifestyle?. Having been "Bitten" once you should have learnt a lesson. I did when I was 18, made a promise to myself I would not play the "Keep up with the Jones" game.If I can't pay for it I don't have it end of.


Over the past 15 yrs or so people have become so materialistic and I just hope the current climate makes people re-think their lives and see what is truely important in life.

Good Luck Bright side and I wish you well......

the_bright_side

leveller2911 wrote: »

Personally I have a lot of sympathy at the beginning of your post , severe fire etc and losing the business the first time.Ive seen this locally and its heartbreaking to see people who have struggled to start and run a business only to have it taken away by a fire or clients owing them money.Having been in business for over 20 years and people owing me money ,but luckily its never been enough to take me under.There but for the Grace of God go I.


"For the next 12 years we built up a new successful and thriving IT consultancy. I had a very comfortable life, with a nice house in the UK, a property portfolio of property in Spain, nice cars, foreign holidays and most importantly my marriage of 25 years, my gorgeous children and my health."

Just my opinion but the above statement is where you lose my sympathy.Why couldn't you just be happy with one house and a loving family.

Having a "Property portfolio" in Spain was just greed, why didn't you save for your luxurious lifestyle?. Having been "Bitten" once you should have learnt a lesson. I did when I was 18, made a promise to myself I would not play the "Keep up with the Jones" game.If I can't pay for it I don't have it end of.


Over the past 15 yrs or so people have become so materialistic and I just hope the current climate makes people re-think their lives and see what is truely important in life.

Good Luck Bright side and I wish you well......

Hello thank you for your reply and your best wishes.

You have the right to your opinion, however I didn’t post my experience to gain your sympathy.

I am in this situation from a mix of circumstances some in my control, however the majority out of my control. I posted my experience so people can see that you can recover from bankruptcy, there is always somebody in similar or in worse situation and that yes as you said there is more to life than possessions.

Re: Property portfolio, you don’t know me, you don’t know all of the circumstances so please dont accuse me of being materialistic or ‘of keeping up with the Jones’, I find that remark very presumptuous and rude.

The properties were an investment by the company, the mortgages (for ease) were in my wife’s name (a mistake know now and was made, after professional advice).

7 people were employed in the management of these properties, 7 families relied on their wages to survive. The feeling of guilt for letting those people down will stay with me for the rest of my life.

In the past I have been very generous with my wealth and helped a lot of people less fortunate than myself.

I did save, however this soon dwindled sustaining a company and its employees, which was owed thousands by others.

And as Theodore Roosevelt said – Its far better it is to dare mighty things, to win glorious triumphs even though chequered by failure, than to rank with those poor spirits who neither enjoy nor suffer much because they live in the gray twilight that knows neither victory nor defeat.” Is that being materialistic?

I see bankruptcy as a way of underlining what has been done. You can’t change your past but you can certainly guide your future.

So again thank you for your response but if you haven’t got anything constructive to say please refrain from saying it.

now

the_bright_side wrote: »

Hello to you all.

I thought I would tell you my story, if it make 1 person feel better it is worth the while.

I left school at 16 and joined HM Forces, after 10 years service I left the Army and started an IT consultancy. In 1996 the business premises we shared with two other companies had a severe fire due to faulty electricity distribution board and it took nearly 12 months for the insurance to settle the claim. In the meantime the business ceased trading and as I had guaranteed a business loan, I was made bankrupt by the bank for less than £21K. In 1996 the banks seemed so much more aggressive about loan repayments.

We didn’t loose the family home as at the time the equity was less than £1000, which my wife purchased from the O/R

For the next 12 years we built up a new successful and thriving IT consultancy. I had a very comfortable life, with a nice house in the UK, a property portfolio of property in Spain, nice cars, foreign holidays and most importantly my marriage of 25 years, my gorgeous children and my health.

Then in 2007 it seemed to change, literally overnight, the business started to lose clients and invoices were not being paid by our customers, the foreign mortgages rates were increased, the rental potential on the foreign properties halved and the business running costs became higher.

Then in late 2007 the foreign banks foreclosed on one then the remaining mortgages, the majority of which were in my wife’s name, this culminated in my wife going bankrupt in 2007. At this point we lost our family home and moved into rented accommodation.

Since 2007 we have down sized everything, I have reduced my personal lending and have fought to keep the business going, all this to the detriment of my marriage, my health and the relationship with my children, the stress has been immense and I know I have been an absolute nightmare to live with. Then when things started to look up, 2 months ago our biggest client went bankrupt and due to the lack of cash flow our business became insolvent with me owing the business a substantial amount in the form of a directors loan.

So now my wife is a discharged bankrupt, my business is now bankrupt I am a discharged bankrupt (albeit 15 years ago) now owing a substantial amount to HMRC and deciding whether I should either go either bankrupt for the 2nd time personally or enter into an IVA.

Both have pro’s and con’s. If I go bankrupt I can start again at the age of 39, however in my industry this may make it hard for me to be employed.

If I go into an IVA I will be able to pay some of my debts back and not be bankrupt, however I will be paying for the next 5 years and again an IVA will may make it difficult to obtain employment.

I have to make a decision in the next few weeks.

However I will base my decision on what is most important to me and my family, this may sound selfish but my health and wellbeing is far more important than my creditors as I have a wife and children to look after.

I may not have the cars, the houses or the business, but I have them.

It’s going to be hard over the next few months, however to all those that are thinking of going BR, I came back from Bankruptcy once, and even with the multiple bankruptcies I intend to try and fight back once again and hopefully start afresh.

To those who are thinking of BR, please think of your health and sanity before everything else.

I know there are going to be those that say pay your creditors off. However if most of your creditors are Credit Cards / banks or finance companies, I think what goes around comes around.

Please feel to PM me if you want to ask me questions.

poor old you, but you are right I would rather have my family and my health then anything else

leveller2911

the_bright_side wrote: »

Hello thank you for your reply and your best wishes.

You have the right to your opinion, however I didn’t post my experience to gain your sympathy.

I am in this situation from a mix of circumstances some in my control, however the majority out of my control. I posted my experience so people can see that you can recover from bankruptcy, there is always somebody in similar or in worse situation and that yes as you said there is more to life than possessions.

Re: Property portfolio, you don’t know me, you don’t know all of the circumstances so please dont accuse me of being materialistic or ‘of keeping up with the Jones’, I find that remark very presumptuous and rude.

The properties were an investment by the company, the mortgages (for ease) were in my wife’s name (a mistake know now and was made, after professional advice).

7 people were employed in the management of these properties, 7 families relied on their wages to survive. The feeling of guilt for letting those people down will stay with me for the rest of my life.

In the past I have been very generous with my wealth and helped a lot of people less fortunate than myself.

I did save, however this soon dwindled sustaining a company and its employees, which was owed thousands by others.

And as Theodore Roosevelt said – Its far better it is to dare mighty things, to win glorious triumphs even though chequered by failure, than to rank with those poor spirits who neither enjoy nor suffer much because they live in the gray twilight that knows neither victory nor defeat.” Is that being materialistic?

I see bankruptcy as a way of underlining what has been done. You can’t change your past but you can certainly guide your future.

So again thank you for your response but if you haven’t got anything constructive to say please refrain from saying it.

Thanks for the post, this is an internet Forum , if you don't want people to critisize your post then don't post a "Warts and all" account of your previous Bankruptcy and possible 2nd Bankruptcy.IMO having 5 or so mortgages on foreign property isn't just investment it is greed , trying to make vast profits in a rising market, you like many other have been caught out, you played the game and lost,its true that many played the game and are now sitting pretty.You could have invested safely with a little return with no risk but you chose to play the Roulette wheel and lost.

I do genuinely feel for you with regards to having clients bounce cheques or go insolvent, ive had this done to me a few times.


Oh and with regards to your Quotation of Theodore Roosavelt:

" to dare mighty things, to win glorious triumphs even though chequered by failure, than to rank with those poor spirits who neither enjoy nor suffer much because they live in the gray twilight that knows neither victory nor defeat.”



"I'm sure he wasn't suggesting gambling with other peoples money.Only time will tell if your "Warts and all" post was genuine and like I said I don't know you nor you me and one thing I have learnt on forums is to take everything posted with a pinch of salt.


I still wish you luck for the future and hope not to see you back in say 8 years time with the same dilemma....

the_bright_side

leveller2911 wrote: »

Thanks for the post, this is an internet Forum , if you don't want people to critisize your post then don't post a "Warts and all" account of your previous Bankruptcy and possible 2nd Bankruptcy.IMO having 5 or so mortgages on foreign property isn't just investment it is greed , trying to make vast profits in a rising market, you like many other have been caught out, you played the game and lost,its true that many played the game and are now sitting pretty.You could have invested safely with a little return with no risk but you chose to play the Roulette wheel and lost.

I do genuinely feel for you with regards to having clients bounce cheques or go insolvent, ive had this done to me a few times.


Oh and with regards to your Quotation of Theodore Roosavelt:

" to dare mighty things, to win glorious triumphs even though chequered by failure, than to rank with those poor spirits who neither enjoy nor suffer much because they live in the gray twilight that knows neither victory nor defeat.”



"I'm sure he wasn't suggesting gambling with other peoples money.Only time will tell if your "Warts and all" post was genuine and like I said I don't know you nor you me and one thing I have learnt on forums is to take everything posted with a pinch of salt.


I still wish you luck for the future and hope not to see you back in say 8 years time with the same dilemma....

Leveller (or is it accuser) 2911 :-p = Again you are assuming that I gambled with other people’s money, incorrect after my wifes bankruptcy I paid back all of my personal borrowing and had no other debt other than a 'directors loan' which wasnt actually a loan to me. It was an amount that I had drawn over a period of time, which was being paid back on a regular basis through Tax on salaray and dividends, this is quite a comment practice within limited companies, which only becomes an issue when you have cash flow problems or you wind a company up. I didn’t even now it existed until I wound the company up.

And there will be many companies out there with similar issues, including many large companies.


As for genuine, I don’t understand that comment why would I not be genuine and waste my valuable time on a forum if I didn’t think it could help somebody?

As per quote, I was merely saying that without risk there often is no gain. Most very successful business people have failed several times, learnt from that failure, which has then enabled them to become successful.

You like you accusations; greed, materialistic, gambler, you seem a very angry person, cheer up and look on the bright side of life, not everybody is out to conusme as much credit as they can, gamble and spend spend spend.

Some of us are / will be Bankrupt through circumstance and just bad luck.