Go Bankrupt or Simply Run? Please Help.

simon1980

Hi Everyone,

Been reading these forums for some time now, tons of brilliant information and lovely people.

Please, forgive me for jumping straight to the point from my very first post, but I feel like running out of time, need to make a decision what to do with my life asap really…

So, my dilemma: do I go the Bankruptcy route or do I just run from everyone and everything and start from scratch? Explaining my situation below (excuse me if its too lengthy and boring).

I live with my girlfriend for almost 6 years now (renting). She’s not working due to mainly health issues. Not claiming any benefits whatsoever (do not qualify we’re told). So, basically I’m earning all the money in the house. Had a good, well paid job until made redundant the beginning of 2009. From that point on our life’s started going downhill only… Debts started mounting up quickly; we leaved off of credit card for almost 6 months until I found another job. Situation was almost critical, was matter of days until we’re made homeless.

However, starting a rather reasonably paid job stabilised things for a while. I started paying off some of the debts, but not at good rate, so interests was killing me (about 1/4 of our income was paying the interests only). Unfortunately, due to the recession and all that crap, the industry I was working in (subcontracting for big firms) started suffering… subsequently, the volume of work decreased and on top of that the rates I was paid at was cut many times… This combined with the inflation and 3 years down the line I was earning about 50% less than when I started… Obviously, debt started piling up again… there was few stages when I could almost see the ‘’Break Even’’ line… was only £1,700 away at some point, but not for long.

I lost the contract at the end of August this year and haven’t earned a penny since then. On top of that, that company paid me less on the last payment (about £400 less than I invoiced for) with some vague excuses (penalties, wrong calculations from my side, etc). Since they ignoring my calls, the only route left to eventually recover those money is Small Claims Court, which again will cost me and even if I win, the money wont make almost any difference to our budget.

Situation at present: I have promised another contract starting mid-October earliest, but not guaranteed (and will be up till Christmas at best and nothing beyond that). Until then all we have is around £1,100 liquid cash in the bank and debt of around £5,5k+ with monthly expenses of around £950 (budget is cut to bare bone already, this sum includes the min repayments on 3 CC too)… The only asset I have is a van worth no more than 2k. and I need it for work (if I can get any).

But this is not all. My girlfriend needs to go on operation in October, which will cost around 5k (including the medicines) and this will max out my credit cards. Not able to take anymore loans out, since I got 3 credit cards already.

I really see no light at the end of the tunnel.

The options as I see it are two: Go Bankrupt and hope for a chance of ‘’fresh start’’ or simply run and hide and hope for the best.

We have friends in Portugal which will help us out in the beginning (accommodation and some work). I have been trying to get rid of the debt for 2 years now and then go there and start new life, but now doesn’t seem possible. Plus, the climate there is more beneficial for my girlfriend.

I had a good look at the Bankruptcy route, but it seems to take ages until is all over (up to 3 years?!) and I’m a free man.

So, my questions I Guess are:

Do I go bankrupt and survive somehow until I’m released (discharged?) from the debt and then go to Portugal?
Or
I simply leave and hope the creditors wont find me?

If I choose first option, I read my Ltd company will be liquidated? What exactly this mean? As, the accounts are due now, do I still have to complete it (and pay the accountants) and do I still have to pay the taxes (which will be absolutely impossible) by the dead line in May 2013? I’ve seen something about ‘’Nil Tax’’ code, but is this apply for companies too or only for individuals? Also, how the judge will look at, me spending our last money for an operation, knowing I’ll be going bankrupt shortly after that? Since, I need the van for work, I guess they’ll let me keep it, but if I want to leave the country with it, will I be allowed? Whats the shortest period from me filling out for bankruptcy to being able to leave the country (obviously I need to make some arrangements before getting there)?

If I choose the second option, simply pack up and leave without telling anyone, whats the worst consequences would be? Can the creditors/DCA’s find me abroad and even if they find me, whats their powers over there, can they harass us, or take our belongings? Will I be able to open a simple bank account in Portugal? Also, if run, what will happen if I want to come back to UK to see relatives, parents, friends from time to time? Will they (creditors) be able to find out if I’m here for say week or two? For how long until my credit file is cleared (if ever) if I run, 6 years?

I really hope for some sensible advice people, I’m really desperate, confused and ashamed being in this situation. All we want is a second chance. Don’t really know what to do. For me, the end of the world will come by end of October and I see no hope.

Please Help.

Simon

tigerfeet2006

Just a quick question to start with, is the debt personal or business related?

kittykat100

Another quickie..

Why are you paying for an operation for your girlfriend.. is it not available on the NHS or is she a foreign national?

Lou67

I wondered what Tiger feet asked too ... As you have a business, it sounds like it may all be quite complicated, and way out of my realms of knowledge, so I think you must see a financial advisor or the C.A.B.

I would say though, that running away to Portugal doesn't sound like a good idea to me. Your debts will catch up with you one day. Best to try and deal with it all now, even it is *does* mean going completely bankrupt.

I do wonder though, are you absolutely sure that your girlfriend is not entitled to *any* benefits whatsoever? Ask the C.A.B. to look into this too.

pleasedelete

Are you in the uk? If she needs an operation it will be free on the nhs.

simon1980

tigerfeet2006 wrote: »

Just a quick question to start with, is the debt personal or business related?

Hi,
all debt is on personal credit cards. company has no debts nor any assets. the van I'm using for work was purchased before and is on my name.

thanks

simon1980

kittykat100 wrote: »

Another quickie..

Why are you paying for an operation for your girlfriend.. is it not available on the NHS or is she a foreign national?

hi,

it is not covered by NHS, not foreigner.

thanks

simon1980

Lou67 wrote: »

I wondered what Tiger feet asked too ... As you have a business, it sounds like it may all be quite complicated, and way out of my realms of knowledge, so I think you must see a financial advisor or the C.A.B.

I would say though, that running away to Portugal doesn't sound like a good idea to me. Your debts will catch up with you one day. Best to try and deal with it all now, even it is *does* mean going completely bankrupt.

I do wonder though, are you absolutely sure that your girlfriend is not entitled to *any* benefits whatsoever? Ask the C.A.B. to look into this too.

''complicated'' in what terms? if its up to me, i wouldnt touch the ltd company, but i read that if I go bankrupt company has to go and I cant be a director for 6 months (?). debt has nothing to do with the business.

we do get a working tax credit tho (£36 a week) as a couple. as for jobseeker's, she went to register, but they told us she wont get anything since not been paying NIC for many years or something along these lines. she just had to go and sign every week and check available jobs, but no cash, so she just stopped doing it, that was 2 years ago...

CAB is most useless organisation in the world (never seen any help from them whatsoever), but I'll call on the other helplines listed here next week

thanks for your help

simon1980

pleasedelete wrote: »

Are you in the uk? If she needs an operation it will be free on the nhs.

it is not classed as ''life threatening'', plus she had series of operations in past 4 years and NHS basically said: ''enough is enough, deal with it yourself''

DarkFallout

I would not advise running or going bankrupt, having 5-10K of non-secured debt is not a good reason for neither

Try to shift the debt on 0% or low APR

Seek advice with regards to benefits and tax credits as I doubt that you do not qualify for anything

Anyway, if you are not able to live normally with the money you get and pay your debt at the same time, as it is non-secured and you are not a homewoner, it would be possible to write it off

Going to Portugal with the current economic situation would be a suicide

IF

Hi simon1980 and welcome to the BR board. First step is to make a list of all your creditors, debts and assets. Secondly and most important is contact one of the following debt charities. Please try these they don't charge and are impartial. They will go through all your options with you and if they suggest bankruptcy then come back to this board and we will help you all we can. Also if your not ‘clicking’ with one of the Debt charities do try another. We advise you to try at least two others for your own piece of mind. Your BR could be refused if you have not sought advice.

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• National Debtline - Website: National Debtline Telephone: 0808 808 4000
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Others:

• Business Debtline
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• Christians Against Poverty
• PayPlan
• TaxAid - Help with tax debts.

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