A Few Questions

KimLyn

This month we stopped paying our creditors at save the BR fees. Should I send a letter to all our creditors to let them know what is happening?
We probably won't get the fees together until late July, is this too long of a wait for them?

I was also thinking of starting to put our wages and move our direct debits to my mums bank account as I am worried that our income will be taken when our account is frozen, but I have been told that we may get in trouble for doing this?

KL

alastairq

Hi... have you read all the stickies at the top of this forum?

These will tell you what happens with regards to BR.[all aspects].


Firstly, you are not obliged [or perhaps, advised] to inform creditors of your plans.

This only compels them to up the ante with regards to pestering you for payment.

It takes a month or two for them to place your debts as defaults....which will happen anyway, regardless.

Even if one or more actually can get a CCJ against you in the interim period, the BR will trump all.

On the second point, you would be best advised, to open your own basic bank account[s] with a bank such as Co-op or Barclays......[unless they are creditors,of course.]...these two banks are BR-tolerant.

In any event, you should have already opened new bank accounts [as above, I suggest?] to move your income and living expenditure away from any creditor? This is a primary rule when dealing with debt.

The problem with moving to your Mum's account [cannot understand why you should consider doing this anyway?] is proving a separation between your money and your Mum's.

It sounds from your post that you haven't yet sought the required advice , from one of the debt charities such as CAB?

This needs to be done before petitioning BR, as a Judge may not grant the petition, at that point in time, if he/she doesn't think you have been in receipt of the proper advice regarding how BR affects you....as it is a very important and powerful legal step you are taking.

HappyMJ

KimLyn wrote: »

This month we stopped paying our creditors at save the BR fees. Should I send a letter to all our creditors to let them know what is happening?
We probably won't get the fees together until late July, is this too long of a wait for them?

I was also thinking of starting to put our wages and move our direct debits to my mums bank account as I am worried that our income will be taken when our account is frozen, but I have been told that we may get in trouble for doing this?

KL

Agree with last post do not move your wages to your mums account. You can however cancel all of your direct debits. Every time you are paid withdraw all of your balance in cash and pay all of your essential bills in cash. You can stop paying most things such as gas/electric/water/council tax to save up the BR fees quicker. You will still need to pay essential things such as car insurance, food bills and petrol. On the day of BR all the accounts with gas/electric/water/council tax are closed and new ones set up with a starting balance of zero.

KimLyn

We are fully up to date on all our utility bills and pay these monthly by direct debit so these won't be included in the BR.

We were advised to go BR years ago but thought it better to go on dmp but getting nowhere fast so thought it is time to go BR.

Am I better off arranging a BR date after my utility bills have been paid?

I have read the stickies but I am still unsure when your bank account is frozen. Is it when you have your appointment and pay your fee or weeks later when you have the OR appointment? I think I have read that it is frozen for a week but a relative said that theirs wasn't frozen at all.

KL

alastairq

On the day of BR all the accounts with gas/electric/water/council tax are closed and new ones set up with a starting balance of zero.

Not quite correct.

On the day of BR [or whenever the initial phone call is conducted] the OR will ask if any accounts are being used for normal living expenses.

The OR is simply interested in any excessive savings, etc...or monies over and above those required for reasonable living expenses.


As I said, open basic bank accounts with [we suggest] either Co-op or Barclays.

Transfer all DD's, SO's etc to this/these accounts, as well as income payments.

No need to cancel DD's, or even, withdraw whole wodges of cash.

[If the OP opens a Co-op account, they can speak to the specialist BR department at Co-op, explain the situation, they will advise what to do.]

Am I better off arranging a BR date after my utility bills have been paid?

For your peace-of-mind, this can be a good idea.

I have read the stickies but I am still unsure when your bank account is frozen. Is it when you have your appointment and pay your fee or weeks later when you have the OR appointment? I think I have read that it is frozen for a week but a relative said that theirs wasn't frozen at all.

Sadly you are mixing urban myth with fact.

Any bank account you have active at the time of petition, can still be used....especially if it is a basic account set up for the reasons above.
The OR is obliged to seek any pecuniary assets that may be hidden in accounts......an account used solely for reasonable living expenses won't be of interest to the OR.

It is the banks that freeze or close accounts, not the OR.

Either because they don't like bankruptcy.....or are creditors.

A bank may freeze an existing account instantly..or may take weeks or months..or, not at all, as the mood strikes.

It's all to do with the credit records of the individual, not because of any specific regulation.

Open a new account [try Co-op..can be done over the phone ], get it up and running, speak to the bank, see what they advise upon the BR petition?

newlifein2011

Hi,

Our account didn't get frozen at the time of BR. We had a standard (not basic) current account with the Co-op which we set up around the time we decided we had to stop paying the creditors as we owed money to our previous bank.

We did withdraw some cash on the day of BR as a precaution but when we spoke to the OR on the day of our BR he asked about our accounts and how we use them, he said he had no interest in the co-op account as it was just day to day living but not to use the others (we hadn't for months ages so no idea if they were actually frozen). We opened a Co-op Cashminder that day, the process took a few weeks to get the account up and running and the Co-Op kept the other account open until the Cashminder was ready. They were very very good about this and kept the current account going until mid October after BR early Sept, they also put something on the closed account meaning that everything transferred to the new one.

I am not sure about utility bills, our were on a rolling direct debit and fully up to date, the accounts did reset at the time of BR but have no idea what impact (if any) that really had.

I would also advice not telling creditors, maybe a letter explaining financial difficulty or an offer of a token payment may help to extend the time before the hounding starts. It really depends on how quick you can save the money / arrange BR, we stopped paying in April / May and went BR in Sept, didn't get anyone at the door or CCJ's in that time although lots of phone calls and letters - even frequent phone calls at work, which was horrible. Thankful to say they do stop quite quickly afterwards, have only had one call at work since and we changed our home number, just to remove the anxiety I used to feel when the phone rang, I now know for sure that it's not a creditor when the phone rings.

Good luck working through it all, this is the hardest time in the process. The actual BR has passed really quickly for us, we are 9 months in now and although still skint we are happy and are able to feel hopeful about the future again.

x

KimLyn

Thank you for everyones help.

We currently only have a basic bank account with nationwide and owe no money to them. Would it be worth asking nationwide if we could keep this account or would that worry them now and they close the account anyway?

Am I also right in thinking that because the basic account is only used for living expenses it wouldn't be frozen?

KL

alastairq

Am I also right in thinking that because the basic account is only used for living expenses it wouldn't be frozen?

You need to speak to your bank in this respect.

It is the bank that would 'freeze' your account, not the Receiver.

In any event, it can do no harm if you open a basic account with either Co-op or BArclays.[see other threads about these two banks]...

Then, if Nationwide prove to be blinkered in their outlook towards BR, you have the other account to fall back on [I would use the other new account anyway...I don't trust Nationwide!]

PippaGirl_2

Nationwide are not known to be BR friendly

tigerfeet2006

We have had the issue on the board before with Nationwide where the staff in branch or customer services have said yes but a couple of months later the computer says noband the account has been closed at no notice. A few people have managed to keep their accounts but they are the exception rather than the rule.

You would be better off opening a Co-op or Barclays account to be certain. See the sticky.

KimLyn

Hi,

Still trying to get everything sorted for our BR.

We have a car which is on finance and would have been returned to the garage to clear the finance.

My Mum was going to buy us a cheap car to use for work but I would like to know where we stand if she was to buy our car from us to settle the finance and help towards the BR fees?

The car would then be in her name but we would be the only ones using it. Can we put down monthly costs in our expenditure? Would this be seen as getting rid of an asset?

KL