Ask a StepChange (formerly CCCS) counsellor a bankruptcy question

Former_StepChange_Rory

Crapwithmoney wrote: »

Hi,
I made myself bankrupt in Jan 2013 and was released from bankruptcy in Jan 2014. I was told that I had to pay back any access income for a further 2 years, until Jan 2016. My house was repossessed at the time.
Yesterday I attempted to open a basic bank over the phone with NatWest and when they got to the part about former addresses I got told I'd been declined, this I was told would go on my record so now when asked have I ever been declined a bank account I will have to say yes ! .... I then spoke to the "Bankruptcy Advisory Service" who said banks are not allowed to decline basic banking services if I'm no longer bankrupt and I should complain as the girl I was dealing with obviously didn't know what she was doing....

Is that right? And if so can I have the fact I was declined an account taken off my record??

Thanks in advance

Hi there,

Thanks for posting.

It's hard to say why the bank have declined your request to open a basic bank account. These accounts aren't usually checked against your credit report and are usually recommended if you have poor credit.

Although basic bank accounts aren't usually refused on the basis of poor credit, there could be many other reasons why the account was declined.

It sounds like you haven't had a great experience so you could speak to the manager to see what happened. It might be easier to try another bank, building society or credit union to see if you're able to open an account. You can view a list of basic bank account and the facilities each of these provide by visiting the basic bank accounts page.

Try not to let this put you off, this is a question that we get asked about a lot and our advice is to keep trying with different banks until you're successful in opening an account.

Rory

[Deleted User]

StepChange_Laura wrote: »

Hi there,

Thanks for getting in touch and welcome to the forum. It’s common for the official receiver to look at your spending habits in detail – although this isn’t always pleasant, it’s a normal part of the bankruptcy process.

I’d recommend you provide as much information as the official receiver asks for. If you use online banking you can often download your bank statements, or you can get in touch with your bank to ask them to send you a paper copy in the post.

In terms of taking cash out via your credit cards, this is something I’d suggest you discuss with the official receiver. We always recommend being open and honest with your official receiver about your situation.

I hope this helps.

Kind regards,
Laura

Many thanks for your prompt response Laura. I will o very prepared next week.

alioroy

Hi.

Our business folded in 2010 and we were declared bankrupt in 2012 and later discharged. We heard recently that the OR no longer has any interest in our house as it is in ( slight) negative equity which was a huge relief. We went into voluntary bankruptcy through CAP and have always done everything by the book. As advised we paid our mortgage but referred all other creditors to the OR or CAP.

As the solicitor was in the process of changing the deeds back into our name we noticed a second charge from HSBC on the property. Assuming it was an oversight we contacted both HSBC and the OR. It now transpires that we still owe 16k from a secured business loan. We were totally unaware that secured debt was not included in BR. Ignorance is not an excuse but at no point did anyone mention this or tell us to keep paying this creditor. This loan was secured as part of the original business set up.

What do we do now? We have had no correspondence from HSBC in several years and we have made no payment. After going through the mill for several years could HSBC now try to repossess when the house prices rise.

Thanks

New2day

Hi I have received a letter requesting a large sum of money, or they will proceed to register it and take me to court. I am going bankrupt in a week, so do I add this person as a potential creditor as he has made known how much he wants and how he intends to pursue it. Or does this count as a new debt after bankruptcy if he goes to court, and I am liable.

As he has stated an amount now, and I was not aware of it, and I am about to submit my creditors report. He would need to take me to court to get the money requested, but has sent a lawyers letter setting out that he wants payment in 14 days.

alastairq

Hi...since you are intending to petition for BAnkruptcy....and the letter mentioned proves the 'debt' existed beforehand, it would automatically be included in that bankruptcy.

To register as a creditor, they would have to prove [to the Official Receiver] that the debt exists......regardless of whether you have mentioned it, or not.

Once you are Undischarged BAnkrupt, keep an eye out for Court letters, respond to them, submitting your Defence against any Claim, quoting the BAnkruptcy Order references.
This will prevent the Court from issuing a CCJ against you inadvertently....since removing such a CCJ from your records [should you wish to] will have an admin charge attached.

Former_StepChange_Rory

Alioroy wrote: »

Hi.

Our business folded in 2010 and we were declared bankrupt in 2012 and later discharged. We heard recently that the OR no longer has any interest in our house as it is in ( slight) negative equity which was a huge relief. We went into voluntary bankruptcy through CAP and have always done everything by the book. As advised we paid our mortgage but referred all other creditors to the OR or CAP.

As the solicitor was in the process of changing the deeds back into our name we noticed a second charge from HSBC on the property. Assuming it was an oversight we contacted both HSBC and the OR. It now transpires that we still owe 16k from a secured business loan. We were totally unaware that secured debt was not included in BR. Ignorance is not an excuse but at no point did anyone mention this or tell us to keep paying this creditor. This loan was secured as part of the original business set up.

What do we do now? We have had no correspondence from HSBC in several years and we have made no payment. After going through the mill for several years could HSBC now try to repossess when the house prices rise.

Thanks

Hi there,

Thanks for posting.

Secured debts aren't included in bankruptcy if you're allowed to keep your property, so it's important to make arrangements to repay the loan and get in touch with the creditor to make sure you're not behind or at risk of further action.

In general, as long as you maintain payments to the secured loan then this reduces the risk of further action. It would be important to discuss any arrears that may have built up, if any and make arrangements to repay the loan. It does seem odd that the creditor hasn't been in contact for such a long time, but they should be able to explain this to you.

I hope this helps,

Rory

Former_StepChange_Rory

New2day wrote: »

Hi I have received a letter requesting a large sum of money, or they will proceed to register it and take me to court. I am going bankrupt in a week, so do I add this person as a potential creditor as he has made known how much he wants and how he intends to pursue it. Or does this count as a new debt after bankruptcy if he goes to court, and I am liable.

As he has stated an amount now, and I was not aware of it, and I am about to submit my creditors report. He would need to take me to court to get the money requested, but has sent a lawyers letter setting out that he wants payment in 14 days.

Hi there,

If the debt that is being claimed for is provable in bankruptcy, then you should add the details to your bankruptcy forms and it should be included. You shouldn't be liable to repay any debts that were taken out before the date of your bankruptcy, as long as they are provable.

As long as you've provided as much information as possible and declared the debts to the best of your knowledge on the forms then this is usually enough information.

In some cases, debts that you might not have been aware of do arise in the future from before your bankruptcy and these would usually also be included, provided they were taken out before the date of your bankruptcy.

To clarify, 'provable debts' are most unsecured debts with the exception of child maintenance arrears, fraudulent debts, gambling debts and a few other types of debt. You can read more about what debts are included in bankruptcy on our bankruptcy debt page.

I hope this helps,

Rory

alioroy

Thanks. We have not made any payments since 2010 and referred all correspondence at the time to the IP or CAP. We have heard nothing from HSBC in the last few years nor is it showing on our credit file. We were in total ignorance until we looked at the land registry. My concern is that ignorance is not an excuse and they will think we have been avoiding payment. I just want to know how best to approach them and negotiate. Should I go through CAP again or try ourselves?
Thanks

StepChange_James

Alioroy wrote: »

Thanks. We have not made any payments since 2010 and referred all correspondence at the time to the IP or CAP. We have heard nothing from HSBC in the last few years nor is it showing on our credit file. We were in total ignorance until we looked at the land registry. My concern is that ignorance is not an excuse and they will think we have been avoiding payment. I just want to know how best to approach them and negotiate. Should I go through CAP again or try ourselves?
Thanks

Hi there,

It's usually easiest to agree payments when you've got an up to date income and expenditure budget, so going to either CAP or us for advice would give you that and give you a chance to talk this over.

As it's a secured debt we'd generally recommend it be treated as a priority but obviously this is a little different as it's an old business debt.

I wouldn't worry too much about the length of time it is since you last paid them anything. It doesn't sound like they've done a lot to follow up on the account either.

All the best.

James

bustedandbroke

Hi
not sure this is posted in the correct place -

I am on the verge of bankruptcy .

I understand that they will be looking at equity in my home , which is mortgaged and in both me and my wifes names. My mother in law has lived with us for about 10 years, in an annexe to our main property ,that she funded herself from the sale of her property .

my question is whether she would have any legal standing or claim on our property when it comes to assessing the equity left in the home ?