Worried, Scared and Stressed!

loutei

Hi Ladies and Gents,
What a wonderful website, with such helpful users, I hope you can help me now.

I have been in debt for many years now and paid the amount due every month, all debts are credit cards, loans or overdrafts. As time went on these payments become harder to make, I went through a period of taking pay day loans to help me survive then got stuck in a rut with these as the interest added on top of the amount loaned killed me. The next month meaning I took the same loan again month after month till I finally escaped with help from my mum. I sat down with her spoke about all my debts to which she was horrified, she said she would take out a loan to help me pay back some of the debters and I could pay her interest free the money back. To anyone thinking about pay day loans DO NOT DO IT they only make things worse!

Anyway as time went on although struggling I got by, but stupidly ran the debts back up. Then the worst happened and I lost my job last year. I contacted the CCCS and they sorted a budget plan arranged letters and advised me to pay token payments of £1 to each debter, excluding my mum.

A year down the line and my situation has got worse, after requests in the letters drawn up by the CCCS to reduce if not freeze the interest, the banks took no notice and continued to charge interest, therefore my debts have become more then they were a year ago. I have fallen out with my mother over all the debts, she has asked me to move out of the family home so I currently have no fixed address I am staying at different friends houses. I have taken the steps to rebuild my relationship with my mum by selling my car, I got £2800 in cash in a private sale and have given this too my mum, we are now back on talking terms which is good, but she has expressed I will not be moving home till I get all this sorted out, she is worried I will either blacklist the house address or DCA will come collecting her things to cover my debt (the CCCS advised me this would not happen but my mum is 'oldschool' and has her own beliefs, I cant convince her otherwise. I feel I have let my mother down and totally accept her reasons, my main priority is to rebuild our relationship especially as she is the only parent I have left, and sort out my financial position.

I have decided the best option will be to do as advised by the CCCS, file for bankruptsy, but a few horry stories has worried me. How will they look at me paying my mum all that car money, I understand I could of given some to my other debters but my family comes first, especially given the banks did nothing to help me get back on my feet just keep charging interest. I am worried they will think im withholding assets (the car money) which could be seen as fraud and I could face imprisonment, this is not the case at all. Could the courts demand me to get some of that money back to pay my other debts as I dont know how that will go down with my mum, after giving her money and trying to rebuild our relationship to asking for it back, if I had too then so be it although I dont know if she would!

All this is stressing me out beyond belief I feel at my wits end and was just doing what I felt was right at the time, but now just as I thought I could see light at the end of the tunnel I face yet another brick wall

Any advise anyone

southgrange

At the time you didnt know you were going BR so personally I dont see there being a problem with you paying back the £2800 to your Mother. If you knew you were going BR and preferred to pay your Mother in preference to your other creditors there would be a problem.

Good luck!

loutei

Thanks Southgrange, I have only today decided to start the BR path, I sold the car 3 weeks ago. I have thought long and hard over time about going BR and now finally feel it is my last and only resort to a debt free future. Thanks You!

Flyright

The OR can seek to recover the money paid to your mother and it wouldn't be necessary to prove you were insolvent.

loutei

Flyright wrote: »

... and it wouldn't be necessary to prove you were insolvent.

Sorry Flyright excuse my ignorance but I don't understand the last part of your post can you please explain

Flyright

If you went into bankruptcy then the OR could require the money you paid to your mother to be paid back into the bankruptcy estate. In doing this the OR would not have to prove that you were insolvent when you paid the money to your mother as she will be considered an associated party.

dancingfairy

Hmm - the Official Receiver could well think you deliberately choose to favour one creditor over another one and reclaim the money I'm not sure how you can get around this. I presume it would take you some time to save up enough to file for bankruptcy anyway?
Can you continue with your debt management plan for a while longer? is this feasilble? your chosen charity should have asked the creditors to freeze interest and charges - how long were you on the plan for as they should have eventually all settled down.
How much do you owe as perhaps a DRO would be an alternative to bankruptcy?
Have you spoken to a debt charity recently?
It might also be worth speaking to Shelter re the housing situation as technically at the moment i believe you would be classed as homeless and given that you may not be able to solve the debt problem immeadiately and be able to move home you may need to see if you get help for housing from the council.
So many questions I know.
Good Luck
df

Penelope_Penguin

southgrange wrote: »

At the time you didnt know you were going BR so personally I dont see there being a problem with you paying back the £2800 to your Mother. If you knew you were going BR and preferred to pay your Mother in preference to your other creditors there would be a problem.

This isn't correct advice (I think you've muddled 2 different things in your mind).

OP, if you have made a preferential payment to one creditor over another (by paying your mother £2800 and nothing to your other creditors) you will have to declare this to the OR.

Have you contacted any of the free debt advice agencies? They can look at your situation as a whole and advise you on your best course of action.

Good luck!

hattybee

You could also end up with a Bankruptcy Restrictions Undertaking/Order (BRU/BRO), which will mean that the effects of your bankruptcy would drag on even longer.
Just been reading of a case where a woman got a 2 year BRU because she “sold her car for in excess of £2000 and gave the proceeds to her father.” (This was in Scotland, but the rules are much the same)
So the longer the time between giving your mum the money and your petition for bankruptcy, the better (at least 6 months should help)

loutei

I again everyone and thank you for your input, sorry for the delay ive not had access to the internet. So the OR (am I right in thinking this is the Official Reciever), CAN demand my mum pay back the money to them, who can distribute this amount between the people I owe money too. I have spoke with the charity CCCS, who might I add have been excellent throughout. Initially they set out a budgett plan for me when I had the car, advising I make £1 token payments to all four of the people I owe money too,excluding my mother, to be fair I didnt mention this debt to them as it was an unofficial agreement wwth my mother so did not think it was something they needed to include, but maybe I should call them and make them aware of this debt also. I ran with there advise for almost a year while I had the car.

When I sold the car, I called them again and spoke with them, they drew up another refreshed budget plan once again advising I pay the £1 token payments but this time spoke about bankruptsy, they advised given my current financial situation I would easily be able to take that route and gave me all the information on how it works. I paid the car money to my mum to smooth things over with her, after I spoke with them. Being at retirement age, on her own and far from rich I wanted to look out for her as she had done for me, but this may now come back to bite me.

Do you think I should hold off for a few months then, I really do not know what is the best option to take, like mentioned it will take me a while to get the money behind me to do it anyway, while on this subject I have been told it will cost £600, £450 court fees + £150 admin that I should get back as I am currently on JSA, will I need the full £600 on the day and clame back the £150 or just need £450?

A few non-professional people (friends), have advised id be mad to file for BR if the banks etc are accepting my £1 for now stay with that, that there is no need for me to go BR. This is all really getting to me now, I just feel I want a fresh start without all this hanging over my head.

Tupperware_Queen

loutei wrote: »

A few non-professional people (friends), have advised id be mad to file for BR if the banks etc are accepting my £1 for now stay with that, that there is no need for me to go BR. This is all really getting to me now, I just feel I want a fresh start without all this hanging over my head.

Whilst creditors are accepting low payments, the debt is not going away, whereas BR will not be an easy choice, but will get rid of the debt, and allow you to get that fresh start.

Its good that you are getting advice from professionals, friends are all very well, but often are ill informed

good luck xx