Thinking about bankruptcy - need some solid advice

icecream69

Hi All,

I am considering bankruptcy, i have got quite a lot of debt, around £20k worth including credit cards, loans, overdraft and SEVEN yes SEVEN payday loans, all of which i am finding extremely difficult to keep up with. I need help in starting my bankruptcy petition and how to go about it. I earn £20k a year and even with that salary i am finding it hard to keep up with payments, for the first few months i stuck my head in the sand and ignored all my credit card and loans but paid the interest on payday loans to rollover for another month, now i am at the stage where some of the companies have agreed payment plans but some havent, I have got 2 debt collection agencies chasing me for payment and sooo many payday loan companies asking me to pay up. I have written to all my creditors, (apart from the payday loans asi i worry that theyl keep ringing me at work) to advise them of my situation but they dont seem to care, only 3 out of the 14 lenders have agreed a payment plan.
my questions about bankruptcy are:
1) Do i apply for bankruptcy and not pay another penny to anybody until then?
2) how much does the OR allow you to keep from your salary on a monthly basis? i tried to look for the household expenditure statistics but cant find them anywhere - will i be left with enough to pay rent, heating etc even if my husband is earning around £800pm?
3) im really scared about doing this but feel its the only way i can do it - is the whole process as bad as im imaginin it?
4) is anyone out there who can talk me through the process?

i have got an appointment with CAB on the 20th April and would preferably like to be bankrupt before the end of the month as the payday loans will all be due then and i dont want to give them another penny.

Please help - Im sorry for rattling on....il stop now!

Thanks in advance.

Icecream69

SunshineBear

Sorry wrong info.

tigerfeet2006

Sunshine, as I pointed out on another thread that is not the figures the OR allows so is not relevant on the BR threads.

NeverAgain_2

Only you can make the final decision to go bankrupt.

Most people who have gone bankrupt seem to have few regrets, and it's certainly a fresh start.

The sooner you decide to go bankrupt, the sooner your financial rehabilitation will begin.

There is no point in continuing to struggle to pay your creditors, and you will need about £600 for the fees at the county court.

Payday loan companies are notorious for taking money from your account, so you could close the one you have - completely and quickly - and open another.

Barclays and the Co-op are known to be bankrupt friendly.

This being the internet, there is a danger of drowning in a sea of information - not all of it correct.

For a straightforward guide to bankruptcy, I like the Insolvency Service website:

http://www.insolvency.gov.uk/bankruptcy/whatisbankruptcy.htm

Most judges will want to be satisfied you have taken advice from a debt charity.

Your CAB appointment will cover that, but if you want to get a move on, you may want to speak to someone else sooner.

There are several debt advice charities - you'll find links on this board.

This is one you could try: http://www.cccs.co.uk/Services/Debtadvice.aspx

tigerfeet2006

Hi and welcome to the board.

icecream69 wrote: »

Hi All,

I am considering bankruptcy, i have got quite a lot of debt, around £20k worth including credit cards, loans, overdraft and SEVEN yes SEVEN payday loans, all of which i am finding extremely difficult to keep up with. I need help in starting my bankruptcy petition and how to go about it. I earn £20k a year and even with that salary i am finding it hard to keep up with payments, for the first few months i stuck my head in the sand and ignored all my credit card and loans but paid the interest on payday loans to rollover for another month, now i am at the stage where some of the companies have agreed payment plans but some havent, I have got 2 debt collection agencies chasing me for payment and sooo many payday loan companies asking me to pay up. I have written to all my creditors, (apart from the payday loans asi i worry that theyl keep ringing me at work) to advise them of my situation but they dont seem to care, only 3 out of the 14 lenders have agreed a payment plan.
my questions about bankruptcy are:
1) Do i apply for bankruptcy and not pay another penny to anybody until then? If BR is suggested then stop paying all debts, keep paying household bills. Save the money for your BR.
2) how much does the OR allow you to keep from your salary on a monthly basis? i tried to look for the household expenditure statistics but cant find them anywhere - will i be left with enough to pay rent, heating etc even if my husband is earning around £800pm? If you pop up your SoA, someone on the board will check it for you and show you how an OR may look at it. http://www.makesenseofcards.com/soacalc.html You put the full household bills, your personal spending ie:travel, medical. Your full income and how much your DH contributes to the full household bills.
3) im really scared about doing this but feel its the only way i can do it - is the whole process as bad as im imaginin it? No, it isn't. Read as many threads on here as you can and you will get a feel for it. Also read the sticky marked LOOK HERE FIRST-Bankruptcy Help.
4) is anyone out there who can talk me through the process? It differs slightly from OR's office to OR's office but is generally you ring your county court and find out if you need an appointment or can you just drop in. Make an appointment and fill in hte forms and save money. Go to court, see clerk who will check your papers and take the fee. He will take papers to judge who may or may not see you, he stamps paperwork. Clerk fills out certificate and gives it to you. You may then talk to the OR's office straightaway ar may have a call in a couple of days. They will confirm a few things like which is your post BR account and then a bcouple of weeks later you will have an OR's interview to go through things. Any other questions just ask.

i have got an appointment with CAB on the 20th April and would preferably like to be bankrupt before the end of the month as the payday loans will all be due then and i dont want to give them another penny. You will probably need a couple of appointments with the CAB to go through things and depending if there is an appointment system at your court then you may have ot wait a few weeks then. If you want advice sooner and without appointments then ring National Debtline. The guys on here can help with your forms as well.

Please help - Im sorry for rattling on....il stop now!

Thanks in advance.

Icecream69

Hope that helps you some.

mel12

1) Do i apply for bankruptcy and not pay another penny to anybody until then? If BR is suggested then stop paying all debts, keep paying household bills. Save the money for your BR.

Once you've decided to go bankrupt, you can stop making payments to the debt companies and save the money for the bankruptcy fee, but read this thread for some important info about how to stop the payday loan companies taking the money from your account anyway.

2) how much does the OR allow you to keep from your salary on a monthly basis? i tried to look for the household expenditure statistics but cant find them anywhere - will i be left with enough to pay rent, heating etc even if my husband is earning around £800pm?

You will be asked to pay any surplus income towards the bankruptcy for 3 years (an IPA), they won't take your husband's income, but will expect him to be making a contribution to the household expenses when working out how much surplus you have. If you want to post an SOA we can have a look and give an idea how the OR might view it.
If your income goes up or down the IPA can be increased or reduced.

3) im really scared about doing this but feel its the only way i can do it - is the whole process as bad as im imaginin it?

Most people on here have posted that it was a lot easier than they thought and a relief once its done

4) is anyone out there who can talk me through the process?

Give one of the free debt charities a call, they should be able to talk you through it. Its important you understand all the consequences of bankruptcy before making a decision.

For example do you own a house or car? If so you might want to look at the rules and whether you'd be likely to lose them or not.

Ineedaname

Also, be prepared for the CAB or whichever debt advice charity you speak with to advise an alternative route to BR. Once they have all your information they may decide another option is more appropriate.

dojoman

Do as suggested and please contact one of the free debt charities, links below:)


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

icecream69

Hi guys,

thank you so much for your responses, i have read thru them all, thank you for the advice, below i have done my soa without my hubbys income and one with my hubbys income, not sure which to use, i spoke to national debtline who said they couldnt give me the correct advice since i live in northern ireland, and when i rang payplan back they said that the price of the bankruptcy is £625, i read online that it was £345 plus the £175 fee, when i questioned that the woman on the phone basically said that i was wrong and hung up on me!! a little surprised to say the least, i am currently fillin in the forms for bankruptcy and it asks about my landlords details, will he be informed of my bankruptcy?

anyways here is the soa for me and my hubby

Statement of Affairs and Personal Balance Sheet
Household Information[/b]
Number of adults in household........... 2
Number of children in household......... 0
Number of cars owned.................... 0
Monthly Income Details
Monthly income after tax................ 1305
Partners monthly income after tax....... 795
Benefits................................ 0
Other income............................ 0
Total monthly income.................... 2100
Monthly Expense Details
Mortgage................................ 0
Secured/HP loan repayments.............. 0
Rent.................................... 495
Management charge (leasehold property).. 0
Council tax............................. 0
Electricity............................. 100
Gas..................................... 0
Oil..................................... 100
Water rates............................. 0
Telephone (land line)................... 15
Mobile phone............................ 30
TV Licence.............................. 17
Satellite/Cable TV...................... 40
Internet Services....................... 0
Groceries etc. ......................... 350
Clothing................................ 40
Petrol/diesel........................... 0
Road tax................................ 0
Car Insurance........................... 0
Car maintenance (including MOT)......... 0
Car parking............................. 0
Other travel............................ 75
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 40
Pet insurance/vet bills................. 10
Buildings insurance..................... 0
Contents insurance...................... 11
Life assurance ......................... 26
Other insurance......................... 0
Presents (birthday, christmas etc)...... 30
Haircuts................................ 20
Entertainment........................... 30
Holiday................................. 30
Emergency fund.......................... 50
Total monthly expenses.................. 1509

Assets
Cash.................................... 0
House value (Gross)..................... 0
Shares and bonds........................ 0
Car(s).................................. 0
Other assets............................ 0
Total Assets............................ 0

No Secured nor Hire Purchase Debts
Unsecured Debts
Description....................Debt......Monthly...APR
credit card....................1800......93........31
credit card....................1600......150.......21
credit card....................3300......140.......25
overdraft......................500.......20........20
overdraft......................3200......100.......39
payday loans...................3407.5....776.......2999
loan...........................5500......246.......19
credit card....................330.......40........45
Total unsecured debts..........19637.5...1565......-

Monthly Budget Summary
Total monthly income.................... 2,100
Expenses (including HP & secured debts). 1,509
Available for debt repayments........... 591
Monthly UNsecured debt repayments....... 1,565
Amount short for making debt repayments. -974
Personal Balance Sheet Summary
Total assets (things you own)........... 0
Total HP & Secured debt................. -0
Total Unsecured debt.................... -19,637.5
Net Assets.............................. -19,637.5
Reproduced on Moneysavingexpert with permission, using IE browser.[/font]

and this is without my hubbys income

Statement of Affairs and Personal Balance Sheet
Household Information
Number of adults in household........... 2
Number of children in household......... 0
Number of cars owned.................... 0
Monthly Income Details
Monthly income after tax................ 1305
Partners monthly income after tax....... 0
Benefits................................ 0
Other income............................ 0
Total monthly income.................... 1305
Monthly Expense Details
Mortgage................................ 0
Secured/HP loan repayments.............. 0
Rent.................................... 495
Management charge (leasehold property).. 0
Council tax............................. 0
Electricity............................. 100
Gas..................................... 0
Oil..................................... 100
Water rates............................. 0
Telephone (land line)................... 15
Mobile phone............................ 30
TV Licence.............................. 17
Satellite/Cable TV...................... 40
Internet Services....................... 0
Groceries etc. ......................... 350
Clothing................................ 40
Petrol/diesel........................... 0
Road tax................................ 0
Car Insurance........................... 0
Car maintenance (including MOT)......... 0
Car parking............................. 0
Other travel............................ 50
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 40
Pet insurance/vet bills................. 10
Buildings insurance..................... 0
Contents insurance...................... 11
Life assurance ......................... 11
Other insurance......................... 0
Presents (birthday, christmas etc)...... 0
Haircuts................................ 0
Entertainment........................... 0
Holiday................................. 0
Emergency fund.......................... 50
Total monthly expenses.................. 1359

Assets
Cash.................................... 0
House value (Gross)..................... 0
Shares and bonds........................ 0
Car(s).................................. 0
Other assets............................ 0
Total Assets............................ 0

No Secured nor Hire Purchase Debts
Unsecured Debts
Description....................Debt......Monthly...APR
credit card....................1800......93........31
credit card....................1600......150.......21
credit card....................3300......140.......25
overdraft......................500.......20........20
overdraft......................3200......100.......39
payday loans...................3407.5....776.......2999
loan...........................5500......246.......19
credit card....................330.......40........45
Total unsecured debts..........19637.5...1565......-

Monthly Budget Summary
Total monthly income.................... 1,305
Expenses (including HP & secured debts). 1,359
Available for debt repayments........... -54
Monthly UNsecured debt repayments....... 1,565
Amount short for making debt repayments. -1,619
Personal Balance Sheet Summary
Total assets (things you own)........... 0
Total HP & Secured debt................. -0
Total Unsecured debt.................... -19,637.5
Net Assets.............................. -19,637.5
Reproduced on Moneysavingexpert with permission, using IE browser.

hope you can help!! it would be much appreciated.

Thanks.

Icecream69

Ineedaname

icecream69 wrote: »

anyways here is the soa for me and my hubby

Statement of Affairs and Personal Balance Sheet
Household Information[/b]
Number of adults in household........... 2
Number of children in household......... 0
Number of cars owned.................... 0
Monthly Income Details
Monthly income after tax................ 1305
Partners monthly income after tax....... 795
Benefits................................ 0
Other income............................ 0
Total monthly income.................... 2100
Monthly Expense Details
Mortgage................................ 0
Secured/HP loan repayments.............. 0
Rent.................................... 495
Management charge (leasehold property).. 0
Council tax............................. 0
Electricity............................. 100 looks very high as you use oil for heating
Gas..................................... 0
Oil..................................... 100 is this reasonable for the size of your property?
Water rates............................. 0
Telephone (land line)................... 15
Mobile phone............................ 30 not allowed
TV Licence.............................. 17 £13 in England, different for you?
Satellite/Cable TV...................... 40 not allowed
Internet Services....................... 0
Groceries etc. ......................... 350
Clothing................................ 40 £80
Petrol/diesel........................... 0
Road tax................................ 0
Car Insurance........................... 0
Car maintenance (including MOT)......... 0
Car parking............................. 0
Other travel............................ 75 you may be asked to provide proof
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 40
Pet insurance/vet bills................. 10 might not be allowed, seems cheap for insurance + vet bills though
Buildings insurance..................... 0
Contents insurance...................... 11
Life assurance ......................... 26 OR may be interested in this
Other insurance......................... 0
Presents (birthday, christmas etc)...... 30 not allowed
Haircuts................................ 20
Entertainment........................... 30 not allowed
Holiday................................. 30
Emergency fund.......................... 50
Total monthly expenses.................. 1509

As you live together and are married you will be expected to include your husband's contribution to the household expenses, not his entire income.

My OR wanted to write to my landlord until I pointed out I had included a copy of my tenancy agreement with the BR application as required. They may still want to contact your landlord if only to check you're not in arrears. My landlord was fine when I told him a couple of months ago I was intending to go BR. His only concern was whether it would affect my ability to pay the rent, which is doesn't.

NeverAgain_2

Whether or not a landlord is informed of bankruptcy seems to vary.

It's no grounds to evict you, unless there is something specific in your tenancy agreement.

Attitudes of landlords to bankrupts also seem to vary.

Some see it as extra insurance: "They wouldn't dare not pay me with the official receiver looking over their shoulder".

There are stories of landlords demand huge sums upfront for new tenants, so best not to move unless you really need to.