Ask a StepChange (formerly CCCS) counsellor a bankruptcy question

StepChange_Aidan

dave3dtg said:

Hi

My Dad passed in April after I declared myself bankrupt with 20 years worth of debts totalling 65K.

In 2007 my parents had a weird will written up. In it it said that half of his half was to go to my Mum and the remaining half was to be split equally between me and my two brothers. 

So I'm bankrupt but have an 8.33% share in a property that could be worth 650K.

My Mum is a very frail 83 years.

Will the OR make her homeless?

Cheers

Hi Dave,

Thanks for your post.

If you haven’t already, you’ll need to let the Official Receiver (OR) know about the situation, as you’re legally obliged to inform them about any assets you acquire between the date of the bankruptcy order and the date of discharge.

If the property is jointly owned, the OR can claim your share as part of the bankruptcy estate. They will usually allow someone else (such as your mum or brothers) to pay an amount equivalent to your equity so that your mum can stay in the home. In some cases, the OR can decide to apply to court for an order for sale. If they were to do this, your mum’s welfare would be taken into account, and the court can postpone the order for up to 12 months to allow her time to move. 

I notice that you’ve started another thread in which you’ve confirmed that the property is held in a trust. Properties held in trust may be potentially classed as an asset by the Insolvency Service, but this can be complicated, and you may need some specialist advice. I would recommend getting in touch with the OR to discuss it with them.

Kind regards,

Aidan

JR27721988

Hi, 
I have daughters advice on my current debt situation and have been advised bankruptcy is an option. 

I am a single parent, on maternity leave at the moment, on paper I am just about keeping my head above water but due to my mental health have stopped paying most bills and waste a lot of money. I know this is wrong, and damaging. I have sought help for my MH and know I need to take control over my spending but I am concerned the bankruptcy will be declined as my bank statements will show countless shopping sprees, eating out etc. 

IbsRaymondsmith

I may have to go bankrupt 

I am working full time but been on furlough for months

my company can’t afford to take everyone back when furlough comes to end next month

they are giving some the option to take unpaid leave until things pick up again 

this means I don’t get my p45

i have no other income so will I get universal credit once my furlough ends?

how will this affect my bankruptcy if I’m expecting to go back to work once a vaccine is made?

StepChange_Aidan

JR27721988 said:

Hi, 
I have daughters advice on my current debt situation and have been advised bankruptcy is an option. 

I am a single parent, on maternity leave at the moment, on paper I am just about keeping my head above water but due to my mental health have stopped paying most bills and waste a lot of money. I know this is wrong, and damaging. I have sought help for my MH and know I need to take control over my spending but I am concerned the bankruptcy will be declined as my bank statements will show countless shopping sprees, eating out etc. 

Hi,

Thanks for posting and welcome to the forum. I’m sorry to hear how you’re feeling.

It’s quite rare for a bankruptcy application to be declined, and the Official Receiver (OR) will not refuse one on the basis of what you have spent your money on in the past. However, they could decide to extend the bankruptcy restrictions for more than 12 months if they feel that the debt was caused by reckless behaviour. 

If you’re still struggling to control spending, bankruptcy might not be the best option for you right now. Before going ahead I would recommend discussing your situation with a debt advisor. If you’d like to get in touch with StepChange our details are here.

It’s good to hear that you are already seeking help with your MH. You may also find this guide to dealing with debt-related stress and MH useful.

I hope this helps.

Aidan

StepChange_Aidan

IbsRaymondsmith said:

I may have to go bankrupt 

I am working full time but been on furlough for months

my company can’t afford to take everyone back when furlough comes to end next month

they are giving some the option to take unpaid leave until things pick up again 

this means I don’t get my p45

i have no other income so will I get universal credit once my furlough ends?

how will this affect my bankruptcy if I’m expecting to go back to work once a vaccine is made?

Hi Raymond,

Thank you for your post.

Without knowing more about your situation and finances, I can’t say if you’d be eligible for Universal Credit. However, you could use an online benefits calculator to see what you may be entitled to claim. 

If your income changes in the 12 months after you’ve applied for bankruptcy, this could change the amount that you pay in an Income Payment Agreement.

Before going bankrupt, I’d recommend reviewing your options with a debt advisor. I can see from your other thread that you’re a landlord, so I would suggest contacting Business Debtline for specialist help.

Aidan

dawd999

Hello
I am after some advice. I am currently in around 41k debt i have no assets or savings. Its all credit cards and personal loans. Due to the current covid crisis iv been unable to work or take on a new job. My mother was diagnosed with cancer at a late stage so i had to give my time to care for her. I have 3 children and even thinking of the debt is making me sick. I have made my mind up to file dor bankruptcy my question is in august this year i had to make a few emergency cash withdrawals from 2 credit cards as i had to replace my kids beds due to bed bugs infestation also paid up rent aswell i am now worried this will go against me?

StepChange_Aidan

dawd999 said:

Hello
I am after some advice. I am currently in around 41k debt i have no assets or savings. Its all credit cards and personal loans. Due to the current covid crisis iv been unable to work or take on a new job. My mother was diagnosed with cancer at a late stage so i had to give my time to care for her. I have 3 children and even thinking of the debt is making me sick. I have made my mind up to file dor bankruptcy my question is in august this year i had to make a few emergency cash withdrawals from 2 credit cards as i had to replace my kids beds due to bed bugs infestation also paid up rent aswell i am now worried this will go against me?

Hi,

Thanks for posting and welcome to the forum. I’m sorry to hear that you’re going through a difficult time and I hope that going bankrupt will give you a fresh start.

You can still apply for bankruptcy if you’ve used credit recently. 

In some cases the Official Receiver (OR) or trustee can extend the length of time that the bankruptcy restrictions apply if they believe that you acted recklessly by borrowing money that you knew that you were unable to repay. This is decided on a case-by-case basis but is less likely if the credit cards were used in an emergency or to pay for essential items.

Kind regards,

Aidan

dawd999

Thankyou for replying Aidan. All of my debt is actually old and as for the cash withdrawals its was only a few 100 that i withdrew. What is the process for bankruptcy if i was to go through stepchange??

sourcrates

dawd999 said:

Thankyou for replying Aidan. All of my debt is actually old and as for the cash withdrawals its was only a few 100 that i withdrew. What is the process for bankruptcy if i was to go through stepchange??

You can take advice from stepchange by all means, but you apply for bankrupcy yourself here -

https://www.gov.uk/bankruptcy

If your debt is old, can i ask how old ?

Could it be statute barred ?

Over 6 years since default or last payment or written acknowledgement ?

dawd999

My personal loans with natwest and tesco bank are around 4 years old. I have never missed a payment till date always paid on time. But i have really started to struggle now to the point i am taking anti depressants.