Ask a StepChange (formerly CCCS) counsellor a bankruptcy question

StepChange_Aidan

funnystrawberry said:

I was made bankrupt in 2015 and came to a repayment plan agreement with the trustees whilst they out a charge on all my properties. I am still in this repayment plan and the amount seems to be reducing exceptionally slowly due to the charges the trustees are applying. I have seen an advert for a bankruptcy expert who will look at the plan and the trustees charges to see if I am being overcharged, however her fee is 800£ with no real assurance that she would be able to reduce the amount. Can anyone advise if they have used a service lime this before with any success or if there is a free service to assess the charges? 

Hi,

Thanks for posting and welcome to the forum.

If a charging order has been placed on your properties due to bankruptcy, 8% statutory interest would be added. There’s no way to stop or reduce this. Are the trustees adding any other charges to the debt?

There’s further information about charging orders here.

Before you consider paying for the bankruptcy service, I’d recommend getting in touch with a free debt advice organisation to discuss your situation and get expert advice. If you’d like to contact StepChange our details can be found here.

I hope this helps.

Aidan 

jontyh

Hi firstly thank you for your help nine years ago, the relief of bankruptcy really took the weight off me I dont know whether you can help me with this one but here goes.
I was made bankrupt in 2011 my wife purchased the beneficial interest less than 10k back from the OR with £1000 given to us by my mother I up until the last 7 months have paid the mortgage now we are separated and selling the property my wife is adamant I am not entitled to half of the profit we were married 33 years of which she rarely worked anyone been through this or anyone know or can advise please also she is convinced I shall have to give her maintenance I earn 29k pa less tax etc any ideas 
Thanks again

StepChange_Aidan

jontyh said:

Hi firstly thank you for your help nine years ago, the relief of bankruptcy really took the weight off me I dont know whether you can help me with this one but here goes.
I was made bankrupt in 2011 my wife purchased the beneficial interest less than 10k back from the OR with £1000 given to us by my mother I up until the last 7 months have paid the mortgage now we are separated and selling the property my wife is adamant I am not entitled to half of the profit we were married 33 years of which she rarely worked anyone been through this or anyone know or can advise please also she is convinced I shall have to give her maintenance I earn 29k pa less tax etc any ideas 
Thanks again

Hi Jonty,

Thank you for posting.

Since your wife purchased the beneficial interest, the property would be in her sole name. 

You may have acquired some new beneficial interest in the property if you’ve been contributing to the mortgage after being discharged from bankruptcy, but this would be difficult to prove unless you have a written agreement setting out how the interest will be divided. I would recommend getting some specialist legal advice about this.

I can’t predict whether or not you’ll be required to pay maintenance as this can be complex and will depend on your individual circumstances. There’s some more information about spousal maintenance on the Money Advice Service website.

Kind regards,

Aidan

Rubilclement

Hi

Am not a specialist in this matter but have been through bankruptcy and ex husband bankruptcy and divorced  As you are married then I would imagine this would be sorted at divorce. Whose name is on the house deeds? Am sure that the OR would have requested a valuation to establish £10K interest. I would assume that a new valuation should be taken now and the difference between the two valuations would be divided and then that would be your equity.  I would seek a divorce lawyer advice (usually can get free 15 mins advice with decent solicitors). Good Luck x

rcuj

Hi
I'm considering going bankrupt and have been looking at my budget. It's a bit touch and go to make ends meet each month and I wondered whether I am able to informally receive financial help each month from friends and family towards living costs?

StepChange_Aidan

rcuj said:

Hi
I'm considering going bankrupt and have been looking at my budget. It's a bit touch and go to make ends meet each month and I wondered whether I am able to informally receive financial help each month from friends and family towards living costs?

Hi,

Thanks for posting.

You may be able to receive some informal financial support from friends and family to help cover your living costs, but if you feel that you’re going to struggle to make ends meet bankruptcy may not be the best option for you. I’d recommend reviewing your budget with a debt advisor if you haven’t already. If you’d like to get in touch with StepChange our contact details are here.

If the financial support will be paid to you on a regular basis, you would need to declare it as a source of income in the bankruptcy application. Support from friends/family isn’t typically counted when calculating an Income Payment Arrangement (IPA) but the Official Receiver would decide whether or not to include it.

I hope this helps.

Aidan

tiggy67

Hi, 3 years ago my husband was made bankrupt after being unable to pay back tax debts, due to incorrect accounts being submitted by previous account (who had retired. After an monthly agreement plan after 1 year, they wanted to increase the monthly amount, which he could not meet each month. They filed bankruptcy proceedings and was made bankrupt 3 years ago. They reposted our home which was a Park Home (left by my husbands late father to him).  I have recently found out that a Park Home comes under the category of “Chattels” and therefor is different from Bricks & Mortar property. My question is, was this a legal form of action to repossess our Park Home, We had no other possessions and now have to privately rent which is now becoming an issue as his work has dried up since Covid. Thank you in advance.

StepChange_Aidan

tiggy67 said:

Hi, 3 years ago my husband was made bankrupt after being unable to pay back tax debts, due to incorrect accounts being submitted by previous account (who had retired. After an monthly agreement plan after 1 year, they wanted to increase the monthly amount, which he could not meet each month. They filed bankruptcy proceedings and was made bankrupt 3 years ago. They reposted our home which was a Park Home (left by my husbands late father to him).  I have recently found out that a Park Home comes under the category of “Chattels” and therefor is different from Bricks & Mortar property. My question is, was this a legal form of action to repossess our Park Home, We had no other possessions and now have to privately rent which is now becoming an issue as his work has dried up since Covid. Thank you in advance.

Hi,

Thanks for your post and welcome to the forum. I’m sorry to hear about your situation and I hope we can help.

Creditors are able to apply to make someone bankrupt in some situations as a last resort. Because they have to pay the fees themselves they’ll usually only consider this if they’re sure that this person has enough assets or income for them to get their money back. Because your husband was unable to repay tax debts, was it HMRC who applied to make him bankrupt?

If a creditor applied to make your husband bankrupt the effect is the same as if he’d applied himself. His details would have been passed to the Official Receiver (or Trustee in Scotland) who can sell his assets to cover the cost of the bankruptcy and to make payments to his creditors.

A park home or mobile home could be considered a house if it’s immobile and kept on land which is let out to provide permanent occupation. The OR (or Trustee) would decide how to treat these on a case-by-case basis, but if there’s some equity in the property it can be sold.

The OR also has the right to sell other items of significant value, including chattels (personal property that can be moved).

This process can be complex and will depend on where in the UK you live. It may be best to give us a call so we can discuss your situation in more detail. Our contact details are here.

I hope this helps.

Aidan

Sadmum23

Hi,
My husband was made bankrupt in 2009 by a firm of solicitors. Due to various circumstances and mounting debt he is considering making himself bankrupt - how would thus be viewed by OR? Thank you

Sadmum23

Sorry also meant to ask whilst there are debts, there are no arrears would this make any difference? - thank you