Bankruptcy advice again please

NeverAgain_2

I agree £700 a month rent for a family home is most unlikely to worry an official receiver.

Of course it depends on area, but there can't be many places in the country which are cheaper.

Johnpj

NeverAgain wrote: »

I agree £700 a month rent for a family home is most unlikely to worry an official receiver.

Of course it depends on area, but there can't be many places in the country which are cheaper.

The OR will be more concerned to see that the rent is affordable and will not lead you into further financial problems.

Teen_the_Drama_Queen

Hi Maizy

Long time no speak - sorry to hear you are still struggling along day by day In this instance it cannot be said time is a great healer!

On the rental front, I have to say, our OR didn't bat an eyelid as to what rent we were paying - rents vary in our area for a 3/4 bedroomed property from roughly £950 pm to £1400 pm and we fall some where mid way in that range.

Stay strong - things have got to better soon :A

Maizy

removed post

kepar

Johnpj wrote: »

The OR will be more concerned to see that the rent is affordable and will not lead you into further financial problems.

Where did this come from?

In our case the OR gave us a maximum he would allow, if it was above we had to find the extra, if it was more than £50 below the extra would have been in my wife's IPA.

Admittedly each OR works slightly differently but it is not what you can afford it is what they will allow.

Johnpj

kepar wrote: »

Where did this come from?

In our case the OR gave us a maximum he would allow, if it was above we had to find the extra, if it was more than £50 below the extra would have been in my wife's IPA.

Admittedly each OR works slightly differently but it is not what you can afford it is what they will allow.

Sorry, not what I meant. I was saying it was what you can afford AND what is allowable. If the OR agreed the rent was fair then they would want to ensure you could afford it. As in one of their roles is to bring some financial order to a bankrupts life. They would not want the bankrupt getting into financial difficulty whilst under their "care". A bankrupt might need to spend X on rent due to local conditions, but the OR will work with the bankrupt to ensure it is actually affordable.

Your OR seemed very harsh. Rents in a local area can vary wildly, and will go up if their is a short term shortage.

However the current housing benefit payments are the same, they give you an amount based on nominal local conditions. If your rent costs more then you have to fund the excess. There are hardship funds and charities who help in some cases.

Johnpj

Here is the extract from the rule book used by the OR in this matter

31.7.87 Consideration of regional cost variations and rental deposits

Regional variations in the costs and availability of rented accommodation will need to be considered by the official receiver when calculating the reasonable domestic requirements of the bankrupt.! As a result of the requirement to pay a deposit when entering a rental contract, it may be necessary to delay the commencement of an income payments agreement to enable the bankrupt to accumulate the necessary funds to make the deposit payment , this action in the long term being beneficial to the estate by increasing the funds available to be paid later under the IPA/IPO. However, any delay in commencement of the IPA/IPO must take in to account that an IPA has to be signed by the bankrupt and the official receiver or trustee prior to the date of discharge.



31.7.88 Other considerations relating to the removal of the bankrupt and his/her family to alternative accommodation

In considering whether alternative rented accommodation is suitable for the reasonable domestic needs of the bankrupt and his/her family, the stage a child has reached in his/her education (for example where he/she needs to remain at the same school to complete a significant exam year) or the care needs of a dependant (e.g. day care or respite care) will need to be considered by the official receiver.! These matters should be taken into account when making any decisions regarding the flexibility of the bankrupt and his/her family in moving to alternative rented accommodation. It may also be necessary to delay collections under an IPA or agree a payment holiday (for example for 3 to 6 months) to allow the bankrupt to find alternative accommodation. !

Official receivers should check with their local council for guidance as to the accommodation allowances considered when calculating eligibility for council accommodation or in relation to !privately rented accommodation, !using the Local Housing Allowance (LHA) to work out Housing Benefit entitlement. LHA is used to work out the Housing Benefit entitlement of tenants renting private sector accommodation in England and Wales and the guidelines used by the council relevant to the area in which the bankrupt lives may be of assistance to official receivers in calculating what the minimum accommodation requirements might be for a bankrupt and his/her family within a similar area to their current accommodation.

Johnpj

Here is the extract covering the general approach to what is reasonable. Of particular note is the clear message to treat EACH case on it's merits

31.7.80 Assessing expenditure against reasonable domestic needs!

When making an assessment of the outgoings claimed as essential by the bankrupt, the official receiver should always consider each case on its own merits. An assessment should be made as to whether the outgoings are realistic, relevant and appropriate to the bankrupt’s circumstances and whether outgoings included are sufficient to provide for the reasonable domestic needs of the bankrupt and his/her family. The Household Expenditure Spreadsheet (HES)!is available on the intranet for comparison, this provides average expenditure statistics available for various household groups, based on the most recent Office of National Statistics figures.

Any expenditure included in the bankrupt’s statement which appears to be non-essential or included simply to prevent any surplus becoming available should be closely questioned,! e.g. weekly launderette costs are included but the bankrupt has use of a washing machine at home.! Particular care should be taken where the bankrupt has been assisted in preparing his/her statement by a commercial organisation, as a set of pro-forma outgoings may have been included which are not expenses actually incurred by the bankrupt on a day-to-day basis, see also paragraph 31.7.26.


31.7.81 Assessing whether expenditure is reasonable or excessive

The bankrupt may argue that the continued payment of certain expenditure items is required, above that considered reasonable by the official receiver to meet the reasonable domestic needs of the bankrupt and his/her family.! If the bankrupt persists in his/her argument, the official receiver should ask for further information detailing the extenuating circumstances justifying why he/she considers this an essential expenditure.! Guidance to assist with assessing whether expenditure claimed meets a reasonable domestic need is provided at the following sections.! It should be noted this is not an exhaustive list, and all expenditure claimed must be considered in the context of the individual’s personal and family circumstances:

kepar

And?
So what is your point to the discussion.

Those facts are available to all and over the years have been posted on this board.

The problem as I see it is that you and quite a few of the newer posters on here seem to feel that if and when they go br
they can at least keep or by manipulation of the allowances have a better lifestyle than they are leading whilst have £000's written off.

The one thing about going br is more often and not sacrifices have to be made, whether it is losing property, cars and other assets of note( in my case a 50 year old premium bond from my grandparents long since gone). Moving to rented accomodation or even to areas you don't want to, maybe upsetting or unsettling children and other family members and of course all tis stress can lead to family breakdown.

If you go br you have to accept that in the short term and probably for the next 5-10 years your life is not going to be how you want it. You are basically controlled by the lack of credit. Every time you apply for something a credit check could get done and you know what it says on your report.

The OR in my opinion is there to help you but at the same time not at the expense of your creditors, why should you have everything than them nothing. So in my case you say he was harsh we don't think so, we think he was fair.

Why should we get above the average , why should we have a larger house than we need?
It is all to your OR to decide what is fair.

NeverAgain_2

kepar wrote: »

And?
So what is your point to the discussion.

Those facts are available to all and over the years have been posted on this board.

The problem as I see it is that you and quite a few of the newer posters on here seem to feel that if and when they go br
they can at least keep or by manipulation of the allowances have a better lifestyle than they are leading whilst have £000's written off.

The one thing about going br is more often and not sacrifices have to be made, whether it is losing property, cars and other assets of note( in my case a 50 year old premium bond from my grandparents long since gone). Moving to rented accomodation or even to areas you don't want to, maybe upsetting or unsettling children and other family members and of course all tis stress can lead to family breakdown.

If you go br you have to accept that in the short term and probably for the next 5-10 years your life is not going to be how you want it. You are basically controlled by the lack of credit. Every time you apply for something a credit check could get done and you know what it says on your report.

The OR in my opinion is there to help you but at the same time not at the expense of your creditors, why should you have everything than them nothing. So in my case you say he was harsh we don't think so, we think he was fair.

Why should we get above the average , why should we have a larger house than we need?
It is all to your OR to decide what is fair.

Wise words.

Some bankrupts see themselves as victims of credit, and it is these bankrupts who give bankrupts a bad name.

The majority of people on this board do not fall into that category.