will i have to go bankrupt??? - bankruptcy petition/hearing recieved

mamasita_2

Hi

My husband has received a statutory demand for bankrupcy. This is in relation to a loan he took out some time ago for £5000 he had been paying the loan for a while and the bank phoned him and asked him if he wanted to increase amount to £10,000 as the interest rate had dropped and the repayments would be almost the same as the initial £5000 loan. He said yes but had to restart whole loan again. He has been struggling for a while now he is self employed. We had an arrangement with this creditor and we were paying £50 per month, however he had two companies go into liquidation on him and for a couple of months we had no income whatsoever!! unfortunately we missed the payments and when the company got in touch with us we offered to restart the payments. We were told that they would have to look into this and they would get back to us with an answer. I waited a month and as we had not heard anything from them I called them to see if his offer had been accepted. I was told that it was now too late as the file had been handed over to their liquidation department and we would have to wait to hear from them!! We have since received a "Statutory Demand under section 268(1) (a) of the insolvency act 1986. Debt for liquidated sum payable immediately. We could not pay the debt immediately and wrote again offering the sum of £50 per month. They have now written back refusing the offer and have now sent a bankruptcy petition to be heard on the 2nd August. What I would really like to know is if my husband can apply for an IVA and not have to go bankrupt or is it too late for that? Also if he is forced to go bankrupt would they force us to sell our house. we have 3 dependent children!! I would really appreciate any help you could give.

Thanks

thefoolonthehill

you need to post this on the banruptcy board. you will get better info on their than here. unfortunately i am not computers savvy enough to move the thread for you.

Do not know the answers to your questions but re the house it depends if there is any equity in it. if there is none they wont force you to sell it as they gain nothing from it

gillypkk

is it a business loan or a personal one? are they petitioning him or the business?

mamasita_2

Hi
It is a personal one!!

mamasita_2

Thanks, i will try

gillypkk

have you rang one of the free debt charities yet and talked to them about it?

MrsTinks

All due respect foolonthehill - you can't move threads only MSE forum staff and BGs can move threads

Mamasita - I have moved your thread

tigerfeet2006

Hi and welcome to the board.

First things first get your DH to ring one of the debt charities and get free, impartial and professional advice on his situation.

Main recommended sources of help:

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

Others:

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

Secondly, as Fool says, is there any equity in the property?

mamasita_2

We would have about 35000 equity. I have rung CCCs counselling and am waiting for them to call back for an interview. Have also asked company to defer the hearing as I am away for 10 days (just visiting family) between now and the hearing which is on 2nd August. They have not given us much time to get advice.

TinyToes

i 'think' you will need to sell your house or ask someone to 'buy out' the interest i.e. you need to give OR the equity you have in your house. Probably not what you wanted to hear.

debt_doctor

Hi,
So your partners share of the equity is 17.5k? less sale costs.

One thing I would be saying to your creditor is that if the bankruptcy goes ahead then this creditor is unlikely to see a single penny as your partners share of the equity would be more than swallowed up in IP fees in dealing with the house. If the BR went ahead, then they could not force a sale of the property for one year. I would consider offering the following;

The instalments already offered.
A voluntary charge (plus above instalments) with a stipulation for no order for sale.
Possibly ask to enter in to an IVA (does he have other debts?)

Even if the order for BR is granted, you may still be able to apply for a fast track IVA.

The biggest point to raise to the creditor is that they will see nothing for their creditors petition fees.

You need some representation, try your local CAB or law centre.

DD