Decisions decisions

cutemum

I have recently had an IVA accepted and am due to start paying 380 per month. Unfortunately my circumstances have changed and I am presently separating from my partner. As a result the money is less in the house & once my partner accepts the situation and moves out I will struggle to make the payments. I was contemplating BR as it would mean I could start afresh. I am scared about the stigma of BR - i mean how i will feel about myself. Will my bank close my account? Will i still be able to pay by direct debit for my electric etc. I do not know what to do. Any ideas anyone????:(

Ineedaname

Hi there, I'm sure someone more knowledgeable will be along shortly, but I can probably help allay some of your fears straight away as they are similar to the ones I had.

Only a few banks are BR friendly, Barclays and the Co-op being the main two. You can open basic bank accounts with them (no overdraft or cheque book although you do get a debit card and can use online banking with the Co-op but not Barclays until discharged) prior to going BR and have all your Direct Debits and Standing Orders transferred across. That account won't be frozen when you go BR.

There is so much less stigma with going BR these days. Since they reduced discharge from 3 to 1 year there are even some people who see it as part of their way of life! They run up huge debts living the life they enjoy, go BR and live frugally for a year, then start running up debts again, then go BR again, etc.

The main issue I considered was that I have a dreadful credit record right now from defaulting on credit card payments 5 years ago and starting DMP with the CAB. If I'd gone BR back then I would be rebuilding my credit rating now. If I continue with the DMP I could have poor credit for the next 40 years, plus all the stress that remains with continued debt. If I go BR now I am clear in a year and can start rebuilding my credit rating pretty much straight away, although I never plan to get another credit card or take out loans/HP. I'm Bipolar so it's not a good idea to start down that road again.

I know I'm going to feel a whole lot better once the deed is done and I'm discharged, a great weight off my mind, no more 6 monthly income/expenditure updates and justifying my expenditure to creditors. A fresh start and a clear conscience. I don't care who knows I've gone BR either, as most of my debt was built up as a result of undiagnosed Bipolar Disorder, so I wasn't in control! Since diagnosis and management of the illness I haven't built up any more debt at all.

Make a list of the pros and cons for your situation, between DMP, IVA and BR and weigh them up against each other. Presumably you're saying your new situation will leave you in a position where an IVA isn't viable anyway? If you have less than £15 of debt there's also the option of a DRO (a Debt Relief Order) which is far better an option than BR.

Good luck.

dojoman

Hi and welcome:)


Please contact one of the charities below, they will offer free and impartial advice.

https://www.nationaldebtline.co.uk/
https://www.citizensadvice.org.uk/
https://www.cccs.co.uk/



Below is a link you may found helpful about going BR?

https://forums.moneysavingexpert.com/discussion/1056083

Also this link to the Insolvency Service is useful!

http://www.insolvency.gov.uk/

alastairq

Hi, and welcome too..

As dojo says, the first step is to seek advice [from one of the debt charities as above].

Apart from anything else, this is an essential course of action..[ie a pre-requisite for BR, the Court has to ask to establish whether the intended BR has received proper advice]....to establish how to deal with the debts.

They will help you to establish whether you meet the strict criteria for BR..or whether there is a more equitable method of dealing with the debts.

I am scared about the stigma of BR - i mean how i will feel about myself.

This seems to be a result of 'conditioning'..by society,parents, peers, etc.

Put into perspective...how do you feel about divorce? Or the failure of relationships?

If you find these acceptable...a normal part of today's life, then why the feelings about BR?

The two are frequently linked anyway...often, I suspect, the stresses of dealing with insurmountable debts can lead to a breakdown of relationships..

All really depends on how you view personal failure?

Whether you view divorce/parting as a means of ending a relationship no longer tolerable?
Whether you view BR as a means of ending a financial situation no longer tolerable..?


Both the same really?

Both have an impact on one's life...often not favourable...but all depends on whether you intend to make the best of a new future?

Will my bank close my account? Will i still be able to pay by direct debit for my electric etc. I do not know what to do. Any ideas anyone????

As posted above.....whatever route you chose it is maybe a good idea to prepare for the worst..... opening new basic accounts will allow you to manage your finances better....DD's can be organised....the only things the basic accounts quoted above lack, over a standard bank account, will be a lack of overdraught facility....a good thing really...and no cheque book...and outdated antique system.

The most obvious change you need to make, regardless of your financial route, is one of how you view life and living?

To turn BR into a positive move requires a change of outlook, focussing on what is most important in one's life, and discarding the detritus....

debt_doctor

Stigma?
Bankruptcy is a very neccesary availability to those who have become over indebted due to subtle changes to their circumstances over time or a sudden event (loss of job, or loss of one income, short time, accident ,illness, relationship breakdown, business failure...............) I see it as no different than to discover you had a life threatening medical emergency- it needs drastic surgery to put it right. Bankruptcy is that surgery.

You are already in one form of Insolvency (IVA). Is the issue around the public arena of bankruptcy? Bankruptcy is no longer advertised in your local paper if thats an issue.

DD

cutemum

Thank you for all your comments. The fact my marriage is over is devastating to me. I feel an absolute failure at the moment. I know it sounds absolutely ridiculous but I imagine I will carry BR like a weight around my neck.

Before i decided on an IVA i sought advice from every available place- CCCS, CAB and a friend of the family who is high up in the insolvency department of his company. I knew all of the pros and cons and believe me I did not make the decision lightly. I just did not think I would be facing the difficulties I am at this point again. On one hand I think BR sounds great in that I would be able to start life again in a years time. This was the 1st Christmas that I did not depend on credit for anything and it felt really good. I know I am wiser and actually look forward to the challenge of being much more careful with my money as for a long time I was spending money that did not really belong to me as i was borrowing it. On the other hand i think I should continue with the IVA route. Apart from the negative feelings I have about it- I can pay back a good bit of the debt I owe. I am thinking I might stick it out a few months and try for a variation.

I am sorry for being all over the place. This is how my head is all the time. I am just looking forward to a more settled life which I hope is not too far away. xx

Ineedaname

It's an absolute minefield isn't it? You've come to the right place for support anyway.

At least talking it out here you will gain knowledge to help you decide how best to move forward.

It might still be worth contacting the CAB again though, once your head is a little clearer, just to help you work out whether you can still manage an IVA or if BR is now the best course.