Newbie who needs help please!

pigsistersjw

Hi Everyone

I am currently in an IVA but struggling now. I am in 86 grand of debt, no equity in the house and own a car valued at about £2200. I was managing ok with the IVA but having had a second child last august we are now struggling. i've just done my income and expenditure for the IVA company yearly review and they now say my income is less than my expenditure (or it will be when I return to work as I will have 2 lots of childcare to pay for). I fell pregnant with my second child before the news of the latest tax cuts were announced and would originally been entitled to enough child tax credit to cover one child at nursery and we could afford to pay for the other at the same time. Then it all changed..... I am now considering declaring myself bankrupt - any ideas if this is likely to be my best option? My IVA company say not but other bankruptcy companies say yes...... so now I'm confused and need some impartial advice pleeeeeese.......
Thanks in anticipation!

IF

Hi and welcome, First thing and most importantly is contact one of the following debt charities. Please try these they don't charge and are impartial. They will go through all your options with you and if they suggest bankruptcy then come back to this board and we will help you all we can. Also if your not ‘clicking’ with one of the Debt charities do try another.

Please don’t do anything rash take your time and weigh up your options and read everything you can x

For ‘essential’ BR info this is Fermi’s sticky - Click here

Main recommended sources of help:

• National Debtline - Website: National Debtline Telephone: 0808 808 4000
• Citizens Advice Bureau - Website: Citizens Advice or visit your local CAB centre (find nearest)
• Consumer Credit Counselling Service - Website: CCCS Telephone: 0800 138 1111
  

Others:

• Business Debtline - Website: Business Debtline Telephone: 0800 197 6026
• Christians Against Poverty
• PayPlan
• TaxAid - Help with tax debts.

And do remember we’ve all been through this and anything you don’t understand don’t be afraid to ask.

Best wishes
If...x

pigsistersjw

thanks very much. Mind you I'm not trying Payplan as they're my IVA company! Will try one of the non profit making ones for advice I think.

NeverAgain_2

sister,

How long will it take you to repay £86K with very little spare each month?

Years and years and years.

I think that answers your question about bankruptcy.

pigsistersjw

NeverAgain wrote: »

sister,

How long will it take you to repay £86K with very little spare each month?

Years and years and years.

I think that answers your question about bankruptcy.

4 years left of IVA ..... fair point but doens't really answer my question as need to know about charges on house etc.....

JCS1

pigsistersjw wrote: »

4 years left of IVA ..... fair point but doens't really answer my question as need to know about charges on house etc.....

If you have little or no equity in the property, the OR will do nothing and will then review at 2 years and 3 months. If no equity they will then arrange for the property to revert back to you.

HTH

mel12

Hi.
In terms of uselful things to know about bankrupcy -

1) if you have over £20 surplus income any time within the first year before you're discharged from bankrupcy you will be given an IPA (income payment arrangement) and asked to pay any surplus towards the bankrupcy for 3 years. However if you don't have any surplus before being discharged after one year (and it doesn't sound like you will), you can't be given an IPA later. If you want to post an SOA we can give a rough guide of how your expenses will be viewed by the OR and if you are likely to get an IPA or not.

2) House may be a problem if theres equity in it now, or if there will be within the next 2 years 3 months as JCS1 says, otherwise it will automaticaly revert back to you.

3) You may lose the car, unless you can prove you have a specific need for it (eg getting to work, kids to school where there is no public transport etc). If you are allowed to keep a car they may sell it and ask you to get a cheaper replacement, paying the rest of the money to the bankrupcy. More info here

Ineedaname

Once an IPA is agreed it can be varied up or down throughout the 3 years if your income/expenditure changes.

silvercar

I fell pregnant with my second child before the news of the latest tax cuts were announced and would originally been entitled to enough child tax credit to cover one child at nursery and we could afford to pay for the other at the same time.

I thought the changes in childcare help dropped the amount you could claim form 80% of the costs to 70%. I realise that extra 10% and now paying 30% can add up, but I wonder if the difference is enough for it to be uneconomical to continue working.

pigsistersjw

silvercar wrote: »

I thought the changes in childcare help dropped the amount you could claim form 80% of the costs to 70%. I realise that extra 10% and now paying 30% can add up, but I wonder if the difference is enough for it to be uneconomical to continue working.

No it would be uneconomical for me to stop working as I'm the main wage earner in the family. My eldest will be off to school is september also therefore less childcare costs will be involved. I onlt mentioned childcare as from the information i was given prior to deciding to have another child implied that we would have enough tax credit to cover one child at nursery but then the rules changed!

tigerfeet2006

Dear MoneySavers....

This is a difficult board - many think bankruptcy too easy - and I dare say in some cases it is. Yet others have been through hell, seen family and home torn apart, and its a welcome and deserved release.

I didn't set up MSE to be personally judgemental, but to help people whatever their circumstances. If you have problems with the Bankruptcy laws then the 'Discussion Time' forum is the appropriate place.

This is to help people who are bankrupt rehabilitate their finances - and I personally wish them all the best - whatever their circumstances.

Many people who have gone bankrupt, have had serious debts, have hidden them for a time, been scared to confront them, suffered depression or have even had suicidal thoughts because of them.

So may I caution MoneySavers to err on the side of kindness. The fact bankrupts are here means they're looking for help, guidance and to take charge of their finances - and that in itself is admirable

Please use your knowledge and kindness to help rather than to berate.

If you feel it’s important to point something out that the poster may find negative but needs to understand, then it's not a problem, but do think carefully about your phrasing - people can be very sensitive and nuances may mislead when it’s in an online Forum.

Martin