IVA or Bankruptcy - hard to be positive

kitty_and_gucci_2008

Hi all,
My wife and I are after some honest advice. We have a 20 month old daughter and expecting our 2nd child in Feb 2012.
We recently moved out of our previous private rented property and have been to the small claim court and we are required to pay £3k+ as we left the property early due to a disagreement with the landlord who was quite threatening but eventually agreed we could leave however a month later they decided to back down, by that point we had moved out. We send a letter confirming we had discussed and agreed to leave early without having to pay for the remainder of the tenancy.
We are now struggling to pay bills and debts which total £40k , and to top it all, my parents have split and my father has come to live with us until he can find alternative accommodation as he does not have anyone else and is 70 year old. We live in a 2 bed ground floor flat, so at the moment it is quite difficult to see light at the end of the tunnel.
We are thinking of either IVA or Bankruptcy. The debts are all in my name but the CCJ for the landlord (£3k+) is in both of our names I am do not want to pay him for this when he said we could leave then changed his mind. My wife only has the CCJ to pay with me. My wife did go bankrupt in Nov 2006 and was discharged within 9 months. I have placed our SOA below which we have also sent off to the Judge to appeal the decision of paying the landlord £3k+ so the judge can see our financial circumstances as we simply cannot afford to pay the small claims judgement.
Would appreciate advice please, thanks:




Statement of Affairs and Personal Balance Sheet
Household Information
Number of adults in household........... 2
Number of children in household......... 1
Number of cars owned.................... 1
Monthly Income Details
Monthly income after tax................ 1500
Partners monthly income after tax....... 689
Benefits................................ 224
Other income............................ 0
Total monthly income.................... 2413
Monthly Expense Details
Mortgage................................ 0
Secured/HP loan repayments.............. 202
Rent.................................... 430
Management charge (leasehold property).. 0
Council tax............................. 89
Electricity............................. 50
Gas..................................... 50
Oil..................................... 0
Water rates............................. 27
Telephone (land line)................... 11
Mobile phone............................ 45
TV Licence.............................. 12
Satellite/Cable TV...................... 44
Internet Services....................... 0
Groceries etc. ......................... 200
Clothing................................ 0
Petrol/diesel........................... 180
Road tax................................ 15
Car Insurance........................... 68
Car maintenance (including MOT)......... 15
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 479
Other child related expenses............ 40
Medical (prescriptions, dentist etc).... 0
Pet insurance/vet bills................. 0
Buildings insurance..................... 0
Contents insurance...................... 0
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 0
Haircuts................................ 0
Entertainment........................... 0
Holiday................................. 0
Emergency fund.......................... 0
Total monthly expenses.................. 1957

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

Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 0........(0)........0
Hire Purchase (HP) debt ...... 12000....(202)......0
Total secured & HP debts...... 12000.....-.........-
Unsecured Debts
Description....................Debt......Monthly...APR
Gas Arrears....................220.......20........0
Electrcity Arrears.............220.......20........0
BT.............................120.......20........0
Hays Credit Loan...............450.......60........0
Halifax Loan...................22000.....129.......0
LIttlewoods....................400.......50........0
HBOS Credit Card...............750.......35........0
Capital One Credit St..........750.......35........0
HSBC Overdratf.................1095......12........0
HSBC Credit Card...............500.......35........0
Lloyds TSB Overdraft...........750.......10........0
Lloyds TSB Credit Car..........500.......10........0
Total unsecured debts..........27755.....436.......-

Monthly Budget Summary
Total monthly income.................... 2,413
Expenses (including HP & secured debts). 1,957
Available for debt repayments........... 456
Monthly UNsecured debt repayments....... 436
Amount left after debt repayments....... 20
Personal Balance Sheet Summary
Total assets (things you own)........... 0
Total HP & Secured debt................. -12,000
Total Unsecured debt.................... -27,755
Net Assets.............................. -39,755
Created using the SOA calculator at www.makesenseofcards.com.
Reproduced on Moneysavingexpert with permission, using IE browser.

IF

Hi kitty_and_gucci_2008, I see you've posted this question on the DFW board too and receiving advice.

I would contact on of the Debt charities and they will go through your options with you and if they recommend BR then come back 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

kitty_and_gucci_2008

Hi All,

We have decided to both go bankrupt.

I have been to the court to get the forms but they said to download from the website, so will do that tonight and print it out. The only problem is that the fees are so high and we cant afford to just pay it as we still have our creditors to pay. In total we have to pay £1400 which is a large ammount.

We are not sure if we will be exampt from paying as i earn £22100 and my wife is part time an earns £8800, we receive £224 child tac credits and child ben per month.

Can we just not pay our creditors and use the money to go bankrupt?

thank you

foolishboy

kitty_and_gucci_2008 wrote: »

Hi All,

We have decided to both go bankrupt.

I have been to the court to get the forms but they said to download from the website, so will do that tonight and print it out. The only problem is that the fees are so high and we cant afford to just pay it as we still have our creditors to pay. In total we have to pay £1400 which is a large ammount.

We are not sure if we will be exampt from paying as i earn £22100 and my wife is part time an earns £8800, we receive £224 child tac credits and child ben per month.

Can we just not pay our creditors and use the money to go bankrupt?

thank you

Absolutely. Most people stop paying months ahead of BR to save for the fees. Send token payments if you like to keep them quietish.

FB

Teen_the_Drama_Queen

Hi kitty and gucci

Didn't want to read and run..... your situation sounds stressful enough without the worry of finances (cramped living quarters, small child, another on the way and an older parent lodging!).

I agree with foolishboy though, stop paying your creditors and save to go BR, it won't be frowned upon, I think it's prob what most people do. If you had spare money lying around to pay for fees you prob wouldn't need to go BR in the first place

You can try the nominal payment to your creditors, we tried, but it didn't stop them ringing. Once you stop paying you are in arrears and they try their utmost to get to speak to you regarding payment of those arrears. Changing your phone number might be your only option to save your sanity

All the best

xxxx

on_the_up_4

having read your post i can only say my advise is based on my similar experience to you and that is go bankrupt as soon as possible, you have no assets and an iva (as i found out) is only a halfway house, your credit file will be shot to hell anyway, i went bankrupt 2 years ago owing £105k and life was hell and as soon as i went br it all changed, as long as your income remains steady then you will come through it better, make the court appointment then stop paying the cards and use that money to pay the fees, you would have to make the call on the utilities and you wont get credit for a long time and i know it sound harsh but based on my experience that seems the more sensible route. good luck

kepar

Is the secured loan a HP agreement for the car?

If so, a lot of HP contracts state that you will lose the car if you go br.

It doesn't happen in all cases, but be aware, if this is the case you may lose your car.

kitty_and_gucci_2008

thank you all.

the car is on hp, had it since march 2011.
We are concerned that we wont beable to save for another car as i have heard the OR takes a hugh ammount for the IPA/IPO. We work 13 miles away from work and our daughters nursury os 2 miles from work, getting the bus would take a long time (2-3 hours each way).
When will the car company usually take the car away?

kitty_and_gucci_2008

the hp is not secure, sorry put that in the worng box on the soa opsss