In court next Thursday for Bankruptcy - Quick Car Question

bluenose38

Hi There,

After running up debts over the last 3 - 4 years, incurred mainly due to failed Business Venture and then Failed Business Franchise i have decided after seeking advice from the CAB that BR is the way to go for me.

I have two burning questions :

1) Wrightly or Wrongly i ended up handing the keys to my house back to Northern Rock last year. Couldnt pay the mortgage etc and was heavily in arrears. After being sold there is now a Defecit of £64k on this property which a third party is now chasing me for !! What happens to this debt when i am made BR ?

2) As I have no real assets and am in rented accommodation i am currently running a 7 Seater Car which i have with Blackhorse Finance. Car is worth approx £5k and i owe about £2.5k on it. I have missed a couple of recent payments.

My current job means that i need a car to go and see customers and also into the office which for me is about a 300mile round trip away. My company may be able to provide me with a car, but then again they may not.

What do you think will happen with the car ?? This does worry me as without a car i cannot do my job properly and the reason why it is a seven seater is because there are 6 of us in the family.

Any help much appreciated.
Thanks.

Bluenose 38

dojoman

bluenose38 wrote: »

Hi There,

After running up debts over the last 3 - 4 years, incurred mainly due to failed Business Venture and then Failed Business Franchise i have decided after seeking advice from the CAB that BR is the way to go for me.

I have two burning questions :

1) Wrightly or Wrongly i ended up handing the keys to my house back to Northern Rock last year. Couldnt pay the mortgage etc and was heavily in arrears. After being sold there is now a Defecit of £64k on this property which a third party is now chasing me for !! What happens to this debt when i am made BR ? Any shortfall will go in to the BR. When the house is sold the secured debt reverts to unsecured and falls in to the BR.In the meantime do not sign anything once you areBR.

2) As I have no real assets and am in rented accommodation i am currently running a 7 Seater Car which i have with Blackhorse Finance. Car is worth approx £5k and i owe about £2.5k on it. I have missed a couple of recent payments. Check your HP agreement there may be a clause about BR in it. What usually happens is that the OR will allow you to keep the car if it is needed for work, and the value is £2000 or less. If the value is more, they can either take the car and give you £2000 towards another one, or you can pay to them whatever difference the car is worth over £2000. But as it is on HP the car is technically not yours yet.

My current job means that i need a car to go and see customers and also into the office which for me is about a 300mile round trip away. My company may be able to provide me with a car, but then again they may not.

What do you think will happen with the car ?? This does worry me as without a car i cannot do my job properly and the reason why it is a seven seater is because there are 6 of us in the family.

Any help much appreciated.
Thanks.

Bluenose 38

Hope this helps?

JCS1

Check the paperwork with Black Horse to see if it a loan or HP (there can be some confusion with this company and which type it is).

If it's loan then that goes into your BR and the OR decides what to do with the vehicle (and they are unlikely to let you keep a vehicle worth £5k, but may - if you can prove a car is essential - give you an allowance for a replacement).

If it's HP, it's more tricky as there is potentially £2.5k that the OR could realise if they decide to pay off the HP and then sell the car.

But if you make a case for an allowance for a replacement then becomes more unlikely that they would take the car but would instead send a letter of non-adoption to the HP company and then it down to them to decide.

It's slightly more complex than usual as there is potentially money that the OR could realise.

dojoman

JCS1 wrote: »

If it's loan then that goes into your BR and the OR decides what to do with the vehicle (and they are unlikely to let you keep a vehicle worth £5k, but may - if you can prove a car is essential - give you an allowance for a replacement).

My car was valued at £4400 and we were allowed to keep it, my daughter was allowed to buy back the BI in it.

JCS1

dojoman wrote: »

My car was valued at £4400 and we were allowed to keep it, my daughter was allowed to buy back the BI in it.

Sorry, I keep forgetting, that is an option too.