Any advice?

HOLIDAYMAD_2

I dont get the impression the poster has actually set the business up yet and that her husband is currently getting a direct payment, i say that as she they stated the nett earnings are based on them expecting to pay 40% tax , he wont have had the assessment yet as only has been freelancing a few months and most of those expenses are tax deductable, so will there a higher income than declared when the assessment is done.

And totally agree with the renting that you need to understand the headaches it can bring and obligations of a landlord with or without a agent. Because for every good tenant there is a bad one.

mel12

Hi,

There are a few options -
1) a DMP (voluntary debt management plan) where you pay your surplus to creditors and have to pay back the full amount over a longer period paying less than the minimum payments

2) An IVA - where you pay an agreed amount for 5 years - paying back a % of your debt and the rest is written off.

3) Or bankrupcy - where you'll likely be given an IPA to pay for 3 years, which can go up or down depending on income, and the debt is written off.

All have different consequences in terms of credit rating, what happens if you stop being able to pay in future etc you should explore before making a decision. Unfortunately all are going to involve a reduction in the amount of money you have to spend in your budget for a few years.

I'd suggest calling another debt charity if you want a second opinion from what debtline has suggested.


If you go down the IVA or bankrupcy route I think you need to sort the house out first and decide whether you want to keep it. For an IVA I think you'd need to convert the secured debt into unsecured debt first (by repossession) to include it. In bankrupcy the shortfall can be included later if you lose the house after going bankrupt, but given that finding rented accomodation and setting up utilities, phone contracts etc will be more difficult after bankrupcy you might want to move first.

In bankrupcy you wouldn't be able to rent the house out and keep it as the OR would want the rental money. The other options would allow you to do this. So I'd suggest researching the rental rates in your area and how much letting agencies charge etc then making a decision about whether you want to keep the house or not first.


Good luck with whatever you decide, and things will get better x

FrenchMaid_2

Thank you all for taking time to comment and dealing with my rather emotional state.

Feeling much better today, had a look at umbrella companies and am amazed by how much we would have every month.

Exploring renting out our property and waiting for the market to improve. The husband said something very true last night that if we treat the house as an investment then it will hopefully pay in the long term.

So no bankruptcy for us. After looking at the numbers over and over again I don't think we are even in the ballpark for bankruptcy.

kepar

Great news, I am glad that you have managed to seriously look at ways to save money and help you through this difficult time. To be honest I think a lot of us on here were questioning why you were even contemplating going bankrupt.
Good luck to you and I hope everything works out well.

Ineedaname

It's great you've seen a way through what you felt was a dire situation with only one outcome. Good luck to you and don't forget, we're here if ever you need us!

dojoman

As a matter of interest if you did go BR and rented out you mortgaged house any rent from that property would be taken by the OR.

harryhound

Other travel............................ 284 - my husband works in London this is 5 days Oyster Card and London Travel plus return ticket to the Midlands for the W/E

Megabus/megatrain/Mational Express any good?
Liftshare web site?
It might be possible to fiddle about with return tickets and do a mix and match type of journey - but don't fall asleep when the ticket collector comes round.

I have fond memories of a National Express driver at 06:00 in the morning trying to explain to a startled family of foreign tourists, that he was offering them the cheapest journey to Heathrow. As they were not coming back they could throw away the return half.

SteProud

HOLIDAYMAD wrote: »

umbrella companies are the biggest legal loop hole in the tax system, use one and you will never regret it as the OP says just make sure your timesheets are in with expenses, i have never ever been paid late.

ive also rented rooms in the past , spare room .com , eveing standard in london, loot etc.

and if your husband googles contractor accommodaiton, i cant remember the company name there is one based in london that will find him accom for no charge, even cheap B & B.

Kepar is bang on it when they say BR is a easy option but can have massive implications if your a good earner. in fact it may be time to drop the earning power if you go BR, then after discharge and say no IPA was awarded then get back on the earning power.

Non payment of your mortage and loan will give you months to save for a rental if your not currently in arrears , it would be a long process before you would be repossessed.

Hi there

I work for an umbrella company so I'm not impartial but a few tips.

Whatever your umbrella advises, ALWAYS keep all your reciepts for expenses incured. Some dodgy umbrellas claim to have a dispensation from HMRC that means you can claim for travel and food etc without the need to produce the reciept.

This is not true, the dispensation is an agreement with the umbrella and HMRC for admin purposes only.

Only claim for what you have spent and always keep the reciept.

Here is an independent link which is a guide to umbrella companies and the gives a list of questions you should ask before you sign up.

http://www.contracteye.co.uk/umbrella-company.shtml

Hope that helps.