Ask a StepChange (formerly CCCS) counsellor a bankruptcy question

Former_StepChange_Rory

littlerock wrote: »

My B-i-l has always been a pain in the proverbial and was constantly in debt so we were all very relieved when around 25 years ago he took himself off to live overseas. He showed up again here about ten years with a nice younger foreign wife (he is in his mid 60s, she is around 50) who did not speak much english. (This is relevant.) She does not do any paid work, had difficulty due to her poor english as much as anything. She also had a dodgy brother hanging back home overseas who seemed to show up periodically and embroil B-i-L in some dubious business scheme.

We kept away as it all seemed to be heading for disaster and B-i-L is the ultimate blagger who never listens to advice. The B-i-L seems to have spun his wife and her brother some yarn about inheriting a large sum, which, possibly due a limited grasp of english (as she is well educated), she bought into. His dodgy brother in law moved here to the UK two years ago with a growing family in tow and began hanging around them even more. B-i-L continued to live beyond his means, fancy foreign holidays the lot.

Reading behind the lines we think the wife's dodgy brother has been borrowing from B-i-L for his dodgy business schemes as well and we have been told he is now out of work. Result is B-i-L has also been borrowing to keep them all afloat and spending well beyond his means. He says his wife has no idea of the state of things. We have avoided contact as much as possible but a letter turned up the other day saying he was around £40,000 in debt and had no means of paying it off. (His wife does not earn anything; he gets £1000 month state pension and has a small part time job of £400 month plus they get housing benefit of around £1000 month. Their rented flat costs £1200. He is officially retired.)

He has written to ask us to financial help and legal advice. We can give neither but assume he probably needs to go bankrupt as he has no real assets or regular income with which to pay his debts which he says are all really interest on credit cards and accounts. Where should he start for advice?

Hi there,

Thanks for posting, it sounds like things have obviously become quite difficult for your brother-in-law, and while there's many reasons why people fall into debt the main thing we're here to do is look at ways to deal with the situation.

We really wouldn't know if bankruptcy was the best way for your brother-in-law to deal with their debts as it all depends on their financial situation and many other factors. We'd first need to look at the whole situation before making any decisions and offering solutions.

You could start by suggesting he gets in touch with us, either by calling us or using our free online Debt Remedy tool. We could also speak to you if we have permission from your brother-in-law and want to help.

At StepChange Debt Charity we offer free, impartial, confidential debt advice and solutions to anyone struggling with their debts. We could discuss the situation with you or your brother-in-law (with their permission) and build up a picture of the situation. Once we have more details we'll discuss what solutions are possible and the next steps to take.

If bankruptcy is their best option, we'd offer our continued support and advice, completely free. In any case we'll be able to offer practical advice and look at a range of solutions to help him get back on track.

I hope this helps, please get in touch with us if you'd like to help, or pass our details on to your brother-in-law.

https://www.stepchange.org

Rory

snackbar

storm35 wrote: »

I am working with Stepchange just now, i have been told since its near April where the rules for bankruptcy are changing, ive to leave it until they know the new rules, but this has been made clear to me, bankruptcy is the only way i can go. In meantime to send letters to my debtors which i have done, my question is, what do i do if they start sending me letters or start calling me up?
I could only write one letter, the other 2 debtors i could not find an address on their site, so i sent them an email?
TIA x

What is due to change with bankruptcy?

alastairq

snackbar wrote: »

What is due to change with bankruptcy?

Nothing major.....probably IS rules regarding how pensions are dealt with.

Also, some limits are being raised, esp. with DRO's [or rather, these changes have been mooted]

storm35

snackbar wrote: »

What is due to change with bankruptcy?

Sorry just seen this, i was told that they didnt know until April but wont be much. Hoping it hurrys up as i am getting so many phone calls and letters threatening this and that.

coolcait

snackbar wrote: »

What is due to change with bankruptcy?

I've just seen the last few posts on this thread.


There are huge changes in bankruptcy starting from tomorrow in Scotland. Here's the Accountant in Bankruptcy's summary:
http://www.aib.gov.uk/news/releases/15151515/0303/cft-guidance-published


I'd like to think that Stepchange wouldn't be so laid back about it all if storm is in Scotland! But things are going to change a lot for us folks north of the border.

Newman2

I will probably enter into a DRO in a few months due to losing my job and was wondering. If I was to make a purchase on my debit card online for 200 pounds for someone else ( they gave me the money to cover it) would the OR see the purchase and decline a DRO? It wouldn't be for me, the other person just hasn't got a debit card to use but wants to save money purchasing online.

Former_StepChange_Rory

snackbar wrote: »

What is due to change with bankruptcy?

Hi there,

There have been some changes to Bankruptcy (sequestration) in Scotland which are detailed on the AiB website. The bankruptcy process in England, Wales and Northern Ireland hasn't changed, except for minor wording and advice changes relating to pensions and the FCA.

I hope that helps,

Rory

Alloneword

I took out my DRO around the end of October 2012 for about £2,000, so i have gone well past the "moratorium period" which i understand was for 12 months but that still gives me 5 more years where it shows on my credit file.

However that beingsaid my question is relating to if i come into money soon, in a nutshell my Mother is unwell and may well die before the end date of the DRO (which i presume is Oct 2017) and haven spoken to her she was thinking of leaving me a small sum of money something between £4,000 - £8,000 in her will.

If she did do this how would this effect me in relation to the DRO would i have to repay the £2,000 in the DRO or has that been cancelled forever? To fill you in a little more i am on benefits (DLA, [low care], and ESA) I presume any money i come into they will take off my benifits, so do i just write to them and explain how much i would have gotten and when i got it.

All1

StepChange_James

Alloneword wrote: »

I took out my DRO around the end of October 2012 for about £2,000, so i have gone well past the "moratorium period" which i understand was for 12 months but that still gives me 5 more years where it shows on my credit file.

However that beingsaid my question is relating to if i come into money soon, in a nutshell my Mother is unwell and may well die before the end date of the DRO (which i presume is Oct 2017) and haven spoken to her she was thinking of leaving me a small sum of money something between £4,000 - £8,000 in her will.

If she did do this how would this effect me in relation to the DRO would i have to repay the £2,000 in the DRO or has that been cancelled forever? To fill you in a little more i am on benefits (DLA, [low care], and ESA) I presume any money i come into they will take off my benifits, so do i just write to them and explain how much i would have gotten and when i got it.

All1

Hi All1,

I'm sorry to hear about your mother's health. Hopefully I can help you feel a bit better about your finances at least.

Unless you were told otherwise, your DRO would have ended exactly a year after it started. So some time in October 2013. Your liability for your debts stops at that point too. So if you were to come into any money it shouldn't be taken to go towards these debts.

On the benefits side of things, DLA wouldn't be affected by any savings you have to my knowledge. Savings can affect ESA eligibility but you need to have more than £16,000 to not qualify anymore. If you receive interest from savings it can be taken into account but they wouldn't stop your benefits, just reduce them slightly. There's more information here: https://www.gov.uk/employment-support-allowance/eligibility.

Kind regards

James

Alloneword

Hi James, many thanks for the reply it's nice to know that any money i get won't be taken off me straight away and there is no way it will be over 16k as i say ma reckons a few thousands (about 5 in her words) so at least her money won't be put towards my past stupid mistakes i made and as for ESA, i'll inform them of whatever amounts that come and they can work out situation at least if i'm honest they can't say anything.

Once again many thanks James

All1