Ask a StepChange (formerly CCCS) counsellor a bankruptcy question

StepChange_Allen

Athelfled said:

My husband and I are divorcing, and he is going bankrupt.  The debts are in his name but we both own our family home.  Please advice what I need to do to protect myself?  Can I be forced to sell the house?

Hi Athelfled

Thanks for posting.

I appreciate that this must be a very difficult time for you. The best thing to do at the moment would be to seek some legal advice on this situation. I imagine that you may have a solicitor already for the divorce, or at least will employ one soon, so I'd recommend discussing your concerns with them. They'll have full details about your financial situation and the divorce, so I'd expect that they'd be able to link these things together and give you all the advice you need.

I hope it all works out okay for you.

Allen

depressed4581

hello
Im currently applying to go bankrupt currently out of work after been made redundant  and sinking further into debt 20K on cards mortgage, rent etc my wife and i receive UC its paid directly to her account every month and can vary from 0 to £800 a month depending on how her 4 weekly pay falls and the hours she works as this is a joint claim it also includes cover for our rent etc.
Now my question is on income and expenditure what should i be putting obviously been a joint claim so i am getting half of whats payed (VARIABLE) but this all goes into her account, and then she is paying all the bills from that and her wages. Now as its her account and her paying all expenses should i leave it all blank as says leave it blank if not contributing maybe a silly question but i feel i'm not contributing in that sense although it is both our benefits and really don't want it to look like i'm trying to hide something i'm not.


We have also received  2 liability orders for council tax one from 2012 and another 2018 totaling £600 these have been sent as 1 each for me and my wife both dated 4/2/20 if i proceed with the bankruptcy are these going to be included or am i better paying these before hand..


many thanks 

CIS

We have also received  2 liability orders for council tax one from 2012 and another 2018 totaling £600 these have been sent as 1 each for me and my wife both dated 4/2/20 if i proceed with the bankruptcy are these going to be included or am i better paying these before hand..

The bankruptcy will absolve you of the joint liability for them but, as your wife was jointly liable, then she still remains liable for the outstanding balance.

StepChange_Aidan

depressed4581 said:

hello
Im currently applying to go bankrupt currently out of work after been made redundant  and sinking further into debt 20K on cards mortgage, rent etc my wife and i receive UC its paid directly to her account every month and can vary from 0 to £800 a month depending on how her 4 weekly pay falls and the hours she works as this is a joint claim it also includes cover for our rent etc.
Now my question is on income and expenditure what should i be putting obviously been a joint claim so i am getting half of whats payed (VARIABLE) but this all goes into her account, and then she is paying all the bills from that and her wages. Now as its her account and her paying all expenses should i leave it all blank as says leave it blank if not contributing maybe a silly question but i feel i'm not contributing in that sense although it is both our benefits and really don't want it to look like i'm trying to hide something i'm not.


We have also received  2 liability orders for council tax one from 2012 and another 2018 totaling £600 these have been sent as 1 each for me and my wife both dated 4/2/20 if i proceed with the bankruptcy are these going to be included or am i better paying these before hand..


many thanks 

Hi,

Thanks for posting and welcome to the forum.

The bankruptcy application needs to include information about all household income, so you would need to include the full universal credit payment and your partners wage. The expenses section should include the bills and costs that are paid out by your wife. This is to show how household spending is shared between you.

If income is variable, I would recommend entering an average based on the last few months.

As CIS has said above, if you are jointly liable for the same council tax debt, your liability would be included in the bankruptcy but your wife would still be liable and responsible to repay the outstanding balance. 

I hope this helps.

Aidan 

BedNBreakfast

Can someone tell me what would happen with a Salary Sacrifice car lease when being sequestered ? 
3 year lease , car gets handed back after the 3 year , and never belongs to me.
Car is roughly £350 a month (which comes off my salary at source) but all maintenence , tyres , insurance and tax is included.
Would i lose this or could i fight it as my daughter has a disability so a car is important.

Thanks

StepChange_Aidan

BedNBreakfast said:

Can someone tell me what would happen with a Salary Sacrifice car lease when being sequestered ? 
3 year lease , car gets handed back after the 3 year , and never belongs to me.
Car is roughly £350 a month (which comes off my salary at source) but all maintenence , tyres , insurance and tax is included.
Would i lose this or could i fight it as my daughter has a disability so a car is important.

Thanks

Hi,

Thanks for your post.

Before you consider sequestration, I’d recommend checking the lease agreement. Some have a bankruptcy clause which allows the leasing company to end the agreement if you’re declared bankrupt. 

If you need to keep the car, you could ask your trustee to allow you to continue making the payments from salary sacrifice. They may agree if the car is an essential item, but this is something which they would decide on a case by case basis.

I hope this helps.

Aidan

Blackswan2020

Hi i have been reading lots of information on here which has some fantastic advice and would like some help please before i proceed with scary thought of Bankruptcy which Stepchange have recomended

after a long marriage we have decided to call it a day and seperate all the debts are in my name and my husband soon to be ex is staying in the property until he can afford to move out. This gives me an income of about £1000 a month and he is offering me £400 a month rent which we worked out to be half of the rent utilities and council tax he will not disclose his income as the debt is mine. Are there any problems with this arrangement as i want to get everything correct one step at a time as this process is scaring me and making me ill i don't know how to cope with the thought of my interview with the OR but need to see this through

Thank you and sorry for long post

BedNBreakfast

StepChange_Aidan said:

BedNBreakfast said:

Can someone tell me what would happen with a Salary Sacrifice car lease when being sequestered ? 
3 year lease , car gets handed back after the 3 year , and never belongs to me.
Car is roughly £350 a month (which comes off my salary at source) but all maintenence , tyres , insurance and tax is included.
Would i lose this or could i fight it as my daughter has a disability so a car is important.

Thanks

Hi,

Thanks for your post.

Before you consider sequestration, I’d recommend checking the lease agreement. Some have a bankruptcy clause which allows the leasing company to end the agreement if you’re declared bankrupt. 

If you need to keep the car, you could ask your trustee to allow you to continue making the payments from salary sacrifice. They may agree if the car is an essential item, but this is something which they would decide on a case by case basis.

I hope this helps.

Aidan

Thanks for your reply Aidan , 

I checked the small print and could see nothing about bankruptcy , this may be because its an employer salary sacrifice lease , and not an actual private lease.

However can you give me some more advice please.
Currently sitting with about 25k of unsecured defaulted debt , car repossession , catalogues , store cards etc , and not much money to pay them off. I was thinking of Sequestration (As i am in Scotland) as i want the debt gone in the quickest possible way.
In terms of these debt management plans how is the amount calculated ? do you pay the entire lot back or is some written off ?
If i was to pay the 25k back it would probably take about 20+ years , hence why i though bankruptcy was the best route or option for me .

Stepchange recommended paying my creditors £1 a month. but the debt would be hanging over me forever.

ukman2012

I had a CCJ registered against me in august 2014.  I then took a DRO in 2015 june, which has all my debts listed including the CCJ.  After the year of the DRO memorandum, everything was marked at 0 balance apart from the CCJ which remains on file and active.  Should it not have been removed and just the DRO showing. 
In a few months time it will be 6 years will it just come off?

Sspence

Hi
I was made bankrupt in 2015. I paid my amount every month for 36 months and was discharged. 
I recently recieved a letter from the insolvency service saying they had money to return to me.
I rang the insolvency service using the number from the gov.uk website not the number on the letter incase it was fraudulent.
It was not, the insolvency service have £2500 to return to me that has gone unclaimed by my creditors! I've never heard of this and quite frankly cannot believe the companies did not lay claim to the money I owed them.
Is this a common thing? I cant find anyone online saying this has happened to them.
Thanks in advance