Im not having a go...

Lifeisbutadream

Richard_S wrote:

Hi there,

There's nothing wrong with that, you did actually raise an interesting question. I think you have probably misunderstood the history and motivation behind the people who post on this forum. There are lots of people like yourself who have run small businesses and for whatever reason have found themselves with no alternative but to declare or be forced into bankruptcy.

My wife and I have run a number of successful businesses over the years, paid hundreds of thousands in taxes, employed hundreds of people and exported goods all over the world. You can imagine how we feel when we're compared to some "wide boy" who has work done and then doesn't pay for it.

It's an unwarranted and unfair comparison. It doesn't bother me personally but I can understand why it bothers other people in our situation. The only regret I've got is that I didn't take another £200k of the banks money and bury it on a desert island somewhere.

As for posters like MrsBee, well, they're good for a laugh.

Richard

I dont compare you to the person who ripped me off. definately.

Sooty0404

Well Done Lifeisbutadream

After initially posting a 'prickly' question and taking a fair amount of flak in the process, you have had the good grace to publicly acknowledge that not all bankrupts deserve a public flogging or banishing to Debtors Prison.

To pose that question on a Bankruptcy Board is like walking into a Crematorium to ask "what's cooking?"

I too hope you recover the money you worked for and thank you for initiating an entertaining debate.

As for me - I'm going to see if I can 'steal' enough money from my creditors to buy a house on Mrs Bees' utopian debt free planet and live happily ever after.

Richard S - with regard to your Battle of Wits with Mrs Bees, shame on you for attacking an unarmed person!

Sooty0404

Mrs Bees

Your original post - "I am speaking from an outsiders point of view"

My question - As an outsider, what do think of the human race?

BettiePage

Sooty0404 wrote:

Mrs Bees

Your original post - "I am speaking from an outsiders point of view"

My question - As an outsider, what do think of the human race?

Remember girls and boys to be nice to all moneysavers as Martin has asked.

rosieben

I sympathise with your problem and really hope that you get some or all of the money thats due to you. I think that anyone who takes something - goods or service - knowing they can't pay for it, is a thief.

I'm a newly discharged bankrupt; because of serious physical and mental health problems went suddenly from earning huge salary to being unable to work at all. Wouldnt have been so bad but I was being chased for negative equity on ex property and they were really aggressive. I was almost suicidal with the worry of it and was advised that my best option was bankruptcy. I still have a hope that one day I might be able to work again and earn enough money to pay off my creditors including the negative equity (but not the huge amounts they kept adding to it 'to cover costs'!).

Incidentally, months after the bankruptcy I was still being hounded in a most viscious fashion for the negative equity. It took 4 letters from me and 3 from the Official Receiver's office before they stopped!

Just my take on bankruptcy, certainly not a path I would have chosed but sometimes its just the end of the line and there's no other option

borosteve_2

Lifeisbutadream:
could you not "sell" the debt to someone else to collect? I seem to remember reading a book recently about a chap from London who would pay x (can't remember the exact figure) in the pound for "lost causes". It might not get all your cash back but at least you would get something. Sorry I can't be more specific but I read quite a lot and can't remember exactly who's biog/autobiog I was reading...

and I sympathise with the people on here who had no other option but to go bankrupt I do not imagine for one minute it is easy, just trying to help the op.

Toto

Business is a tricky thing I'm afraid, something the likes of MrsBees will never understand. When dealing with the public it is essential to ensure you limit bad debt as much as possible, by charging a substantial deposit, having insurance, having a healthy enough profit margin to cover the % of bad debt you are likely to have. I am slightly confused that the works cost you £1400 and yet the charging order isn't for much more than that, there doesn’t seem to be a healthy margin in there, you are in the business of making money after all.

90% of my business comes from established businesses, promoters, event organisers, record companies etc, but all have to complete credit forms to open an account, and all have contracts to sign giving us rights to claim any debts due with interest. All of our clients have 30 day terms, usually this runs to around 3 months before we actually see the money, making cash flow a potential problem but this is always accounted for before we do the job.

We are currently expanding and almost all of the clients from this new branch of the business will be members of the public, so our payment terms will have to change. The contract will state that no date, venue, service, or production will be secured until the thing is paid for. So it will be 25% on receipt of purchase order and the remainder 60 days prior to the event, if the event is less than 60 days away then full payment will be required on purchase order. We will also require that the client has 3rd party cancellation insurance, so if for whatever reason (such as the venue burning down) the event doesn't go ahead they can claim the full cost back. This is pretty standard in our industry and to be honest is the only way to protect your business.

Now MrsBees, I am sick to death of people telling me how everyone would get a far better deal from the banks if everyone paid on time. This is completely untrue. In fact it would likely cost you more to borrow if there was no bad debt. Lets take one of my previous loans as an example, I borrowed 18k, paid £320 per month for 3 years which equaled around £11500 in repayments. I had a really difficult time when starting my business and ended up defaulting on the loan, it took some months for Halifax to file the default and they refused to enter into any conversations at all with me. Suddenly I got a letter from a DCA telling me they now owned the debt and the balance was £19,000, so despite having paid £11500 back, I now owed 1k more than I originally borrowed. To cut a long story short I had 2 options, to declare bankruptcy (total debt at this time was £65,000, all business related) or to sell my house. Because my business was now doing very well I chose to invest my house into it and clear the debt. Had my business been on the brink of survival I would not have hesitated at all to declare bankruptcy, because by my calculations I actually owed all of my creditors the sum of £34,000 the rest was over inflated interest and charges. I did do settlements as much as possible with the creditors and reduced it to £46,000.

Do I have an ounce of sympathy with the banks, not a drop, I despise their attitude towards debtors. I firmly believe they create this situation and drive people into unsustainable debt in order to maximise profits. For every person who declares bankruptcy there is another handful who will sell their souls to pay every penny. The banks profit beyond imagination from struggling debtors and they know it. Believe me, the day they see a dent in their profits the lending criteria will increase so much even the queen would struggle to get a loan. As it is, they want every tom !!!!!! and harry up to their eyeballs in debt because it makes them money. They can then keep their interest rates lower to encourage more people to take on more debt.

I could rant on all day but I need to get back to work (why can I never answer a post in less than 3000 words?)

Toto

One more thing, to answer the original question, do I have any sympathy for small business effected by personal bankruptcy the answer is yes and no. I realise this won't be the most popular opinion I have ever posted, but, I do have sympathy that small businesses have a flawed business model, that they haven't taken steps to protect themselves and are setting themselves up to potential faliure before they begin trading. You can not run a sucessful growing business by living so close to the line that one non paying client (of less than £2000) causes you to personally be unable to pay your mortgage.

The lack of protection, either by increasing margins somehow (cutting spend, charging more or both) or not securing at least partial payment before work is done, is a bit like me leaving all of my windows and doors open and then complaining I was burgled. People will be unable to pay sometimes, that's an occupational hazzard sadly. I would use this as a learning experience and use it wisely because next time it could be a much larger client who will cost you a lot more. I'm really not trying to critisise you at all and I hope you don't take it that way, I am trying to point out how this could actually be a good thing for you and your business. You are aware of this problem now so use it wisely and prevent your business failing because of bad debts in the future.

borosteve_2

borosteve wrote: »

Lifeisbutadream:
could you not "sell" the debt to someone else to collect? I seem to remember reading a book recently about a chap from London who would pay x (can't remember the exact figure) in the pound for "lost causes". It might not get all your cash back but at least you would get something. Sorry I can't be more specific but I read quite a lot and can't remember exactly who's biog/autobiog I was reading...

and I sympathise with the people on here who had no other option but to go bankrupt I do not imagine for one minute it is easy, just trying to help the op.

Please ignore that last bit of advice, I've just been and scanned through my books, the gentleman in question wasn't a "businessman" in the tax paying sense of the word, so I'm guessing the service offered may not be strictly legal. Sorry about that.:o

wherediditallgo

Lifeisbutadream, I do understand what you're saying as someone running a business, but I honestly believe that very few individuals deliberately take on financial commitments with no intention to settle their bills. Speaking for myself, some of my debts were accrued over several years partly because I had a lot of illness when I was working part-time & wasn't entitled to sick pay, had to move home (an expensive business in itself), & had to help pay medical bills for an elderly parent living overseas. Yes, I did spend on credit cards & buy things that I've long since got rid of, but not all of it was irresponsible spending - I haven't had a holiday in 6 years, don't own a car, designer clothes etc. I don't owe any money to individuals or businesses for work they've done for me - it's personal loans & credit cards.

Let's not forget that some people are ultimately faced with bankruptcy because a lender won't compromise on the payments made, therefore adding more debt to the original bill. For instance, I haven't used one of my credit cards in years - I willingly returned it to them, but they said I couldn't close the account as I'd then have to pay the lot back in one lump sum. They also refused to suspend the interest being charged, as I'm making the minimum payments. So I'm stuck with paying high interest each month on a card I don't use because I can just about pay the minimum required each month, whereas they'd suspend the interest if I couldn't cover the minimum they want. They've actually got more chance of getting the whole debt paid off by suspending the interest, but they can't see that & won't do it, meaning only a small percentage of what I pay is reducing the debt! It's crazy - I don't mind if they say they'll never offer me credit or banking facilities as long as I live, just as long as they suspend the interest so that the £100pm I give them actually goes to pay off the debt instead of less than £30 of it. They won't see sense.

Even though I've been advised by a recognised & reputable company to go bankrupt, I keep stalling because I never in my wildest imagination thought I'd end up in this position. It's by no means an easy option for me - it's the only one. I can't sleep with the worry of the accumulated debt, spend a lot of time crying & I'm making myself ill, so I won't feel sorry for the bank & credit card companies if bankruptcy means they get nothing in the end. I've genuinely tried to pay but they won't help me - they were quick enough to give me the cards in the first place though at 18 years old. I'm an honourable person, & if I had the money to make monthly payments for years to come without putting my own mental & physical health at risk, I would do so to clear every single debt. It's a bit late in the day, but I know it's not going to happen. If I'm to move my life forward & learn from the experience I've had, bankruptcy really is the only option.

We all make mistakes in life, & to those who say don't live beyond your means etc I say this. Unless you live on your own, see no-one & talk to no-one, what other people do will have an effect on how you live at some point. You can't predict everything in life. The stress I've gone through over the last few years is more than enough punishment for the mistakes I've made. So please don't judge those who, having gone through so much soul-searching & having had proper advice, are left with facing bankruptcy. Just be grateful that it hasn't happened to you yet, & pray that it never does.