Living Through Bankruptcy

freddy911

I've been considering bankruptcy for a while and recently learned that now your not allowed to keep any excess income. From what I gather in you SOA your not allowed such things as gym membership, home phone or broad band. Is this correct? and if so just how tight is it living through and IPA?

Personnaly I feel this is stupid of them not to allow any excess income, as it stands I can opt to work out of hours shifts for enhancements but as im not allowed to keep any of this whats the point? even if they allowed 50% or 25% it would encourage me to work the out of hours and get them more money for the debts.

Thanks

Ineedaname

The allowances are actually quite generous and you can have a home phone. You can even have broadband if you can prove a valid need for it e.g. children's school work, same with a mobile phone.

You can keep surplus up to £20 per month, over that and an IPA would be put in place. Although that runs for 3 years from when it starts, it is variable as income and expenditure changes and can be suspended if you drop below the surplus limit. Any suspended months count towards the 36 month term.

kepar

I do not know your financial position as in how much you owe and whilst I agree that the recent changes have made it difficult to do any extra work going bankrupt is a life changer.
It seems that you want to maintain your current lifestyle whilst having all debt written off, is that fair to all the creditors who are probably going to get nothing back. It is annoying but you only have to live with the allowances for a year if you are not issued with an IPA, then any money you earn is all yours.

Also you can have a gym membership, a mobile phone and the internet but the OR will not allow for it but you can use money from elsewhere to pay for it.
With an SOA the OR allows so much money towards various items, rent :groceries: utilities etc, that will produce a total. What you do with that money is up to you. As long as you pay your bills you can do what you want with the rest. for example you may be able to use £50 of your grocery money, save haircut money for a few months by not having a hair cut, spend the holiday allowance. There are ways around things. It is not all doom.

neil277

srichar3 wrote: »

I've been considering bankruptcy for a while and recently learned that now your not allowed to keep any excess income. From what I gather in you SOA your not allowed such things as gym membership, home phone or broad band. Is this correct? and if so just how tight is it living through and IPA?

Personnaly I feel this is stupid of them not to allow any excess income, as it stands I can opt to work out of hours shifts for enhancements but as im not allowed to keep any of this whats the point? even if they allowed 50% or 25% it would encourage me to work the out of hours and get them more money for the debts.

Thanks

Hi
Things have changed can your try to work out a deal with your creditors, if not you will have to do your sums BR OR IVA.
Can we have more info do you own a home, your job, family and also work out your income let the fourm know please.

If you have a credit card with mnba they will take on your debts and talk to your creditors a very good option.


Thanks

Neil

JCS1

Gym membership is permissible on medical grounds, but you would need a supporting letter from doctor.

mel12

Theres a rough guide to whats allowed in an IPA here.
Like JSC1 says they do take into account individual circumstances to an extent.

Do you have any assets (like a car or a house) as you'd also need to consider what might happen to them in bankruptcy?

MTDancer

kepar wrote: »

I do not know your financial position as in how much you owe and whilst I agree that the recent changes have made it difficult to do any extra work going bankrupt is a life changer.
It seems that you want to maintain your current lifestyle whilst having all debt written off, is that fair to all the creditors who are probably going to get nothing back. It is annoying but you only have to live with the allowances for a year if you are not issued with an IPA, then any money you earn is all yours.

Also you can have a gym membership, a mobile phone and the internet but the OR will not allow for it but you can use money from elsewhere to pay for it.
With an SOA the OR allows so much money towards various items, rent :groceries: utilities etc, that will produce a total. What you do with that money is up to you. As long as you pay your bills you can do what you want with the rest. for example you may be able to use £50 of your grocery money, save haircut money for a few months by not having a hair cut, spend the holiday allowance. There are ways around things. It is not all doom.

Not totally true: our OR scrutinises our bank statements every month and I am sure if he saw a gym payment he would argue that we do not need that money so would disallow it

kepar

MTDancer wrote: »

Not totally true: our OR scrutinises our bank statements every month and I am sure if he saw a gym payment he would argue that we do not need that money so would disallow it

I was using my own experience, my OR did not ask to see any of my statements and my wife who is well into her final year of an IPA has not been asked to produce any of hers.

Maybe your OR is a bit keen or checking that you could be put into an IPA if not already doing so.

Ineedaname

I got the impression my OR would look at an SOA in a similar way to MTD's, maybe not scrutinising statements every month, but it was discussed that if someone could find a bit of surplus within their allowances then they obviously needed less to live on!

I think some ORs are getting stricter like this, whereas others are still inclined to be fairly generous.

kepar

We take a lump sum out at the beginning of the month and use this to live on for the month. We pay cash for everything, so if you did that would the OR want to see all your receipts. Somehow I do not think so.

Ineedaname

I guess it depends if they think you're hiding something, especially considering it's so easy to pay bills by DD and shop online these days.