Ask a StepChange (formerly CCCS) counsellor a bankruptcy question

StepChange_James

kingimuk wrote: »

My employer wants me to sign belatedly an employment contract. In it a clause states that I will (may) be made redundant if I am declared bankrupt. I have queried this and am told this is the law!


Surely this cannot be true as an unemployed person will not be able to earn and therefore never repay creditors!? Who is right?


Thanks

Hi Kingimuk,

It's not against the law to work after being declared bankrupt but there are some occupations that you can't do. There are also some employers that have policies that they won't allow you to carry on working for them if you go bankrupt. These are usually jobs in financial services or jobs that have some sort of financial responsibility.

Whether you have to sign this contract and agree to this clause is something I wouldn't be able to comment on. You may want to speak to a solicitor that specialises in employment law or perhaps a trade union representative.

Kind regards

James

Sarstan

I'm about to go bankrupt. If accepted what happens to my utilities, insurance and sky. I'm not behind in these and they are not included in the bankruptcy. Can I still pay for them with my Barclay's account as usual?

StepChange_James

Sarstan wrote: »

I'm about to go bankrupt. If accepted what happens to my utilities, insurance and sky. I'm not behind in these and they are not included in the bankruptcy. Can I still pay for them with my Barclay's account as usual?

Hi Sarstan,

Apologies for the delay in replying.

If these bills aren't in arrears then the bankruptcy shouldn't have any immediate effect on them.

Your bank account is likely to be affected by bankrutpcy, at least in teh short-term. Our website has more information about how this usually works: http://www.stepchange.org/Existingclients/Bankruptcyclients/Bankaccounts.aspx.

After going bankrupt you'll have a meeting with the Official Receiver and they'll look at your spending. Utilities and most insurance policies will be viewed as essential costs but they may have questions about your Sky bill.

If it's not considered essential then they may suggest you cancel it to increase the money you've got available which could be paid to them as part of an income payment arrangement (IPA) - where you pay any surlpus income to the OR. This decision will depend on your circumstances and the way the OR interprets it.

If you've not had advice yet, I'd suggest giving us a call and we can look at your situation and give you advice: http://www.stepchange.org/Contactus.aspx. If we recommend bankruptcy we'll give you the details of our bankruptcy support team, that can help you through the bankruptcy process.

Kind regards

James

suzpo

Hi
I have an IVA that has now switched to its 3rd company since it started Feb 2014 and i had to agree to an additional years payments from 4 years to 5 years, so that the main creditor would agree. I have struggled with the agreed amount but the Insolvency practitioner have reduced it in the short term but i am always worried that the creditors may ask for another years payment.
Also, i have depression and as a nurse would like to retire in 2 years but will still have 2 years to pay on my IVA.. Will they see my lump sum pension as a windfall or would i be able to make a payment equivalent to 2 years payments to be discharged off it... Or should i just go bankrupt...as i can't get a bank account anyway...

StepChange_James

suzpo wrote: »

Hi
I have an IVA that has now switched to its 3rd company since it started Feb 2014 and i had to agree to an additional years payments from 4 years to 5 years, so that the main creditor would agree. I have struggled with the agreed amount but the Insolvency practitioner have reduced it in the short term but i am always worried that the creditors may ask for another years payment.
Also, i have depression and as a nurse would like to retire in 2 years but will still have 2 years to pay on my IVA.. Will they see my lump sum pension as a windfall or would i be able to make a payment equivalent to 2 years payments to be discharged off it... Or should i just go bankrupt...as i can't get a bank account anyway...

Hi Suzanna,

Thanks for posting.

I'd suggest giving your current Insolvency Practitioner a call and talking to them about these concerns. They should know for certain how your pension will be dealt with and I'd hope they'd be able to give you an honest answer about whether bankruptcy would be better to continuing with your IVA.

Kind regards

James

jysmystry

Hi,

Please help, I am in desperate need of advice!

I separated from my wife a few months back. We have two children together.

We have one of those infamous Northern Rock Together mortgages as follows:-

1. Mortgage Remaining = £117.000 - now transferred to Nram
2. Unsecured Joint Loan = £28,000 - Now transferred to Nram
3. House value - £145-155k
4. Estate Agent "value of house value

Mortgage Remaining + Unsecured Loan = 145,000

I have £12k personal debt (+£2k to family - I know this isn't seen as real)

My wife says we split the equity and she pays £6k onto the joint loan and I pay the rest(!!!)

So I walk way from this with, at best £16,500 but I will have debts of 32,000

I am on a zero% rate for £10,500 of the personal debt until march 2017, the rest is on zero% until last month and for some reason in not getting charged interest yet.

I used the snowball calculator on MSE and it 61 years to pay that off! 'm clearly bankrupt. If I go bankrupt my ex is liable for that joint debt of £22000

So what do I do? If I don't go bankrupt I cant support a home that allows me to have my children to stay - if I do My ex will likely go bankrupt herself. Which option isn't awful

StepChange_Allen

jysmystry wrote: »

Hi,

Please help, I am in desperate need of advice!

I separated from my wife a few months back. We have two children together.

We have one of those infamous Northern Rock Together mortgages as follows:-

1. Mortgage Remaining = £117.000 - now transferred to Nram
2. Unsecured Joint Loan = £28,000 - Now transferred to Nram
3. House value - £145-155k
4. Estate Agent "value of house value

Mortgage Remaining + Unsecured Loan = 145,000

I have £12k personal debt (+£2k to family - I know this isn't seen as real)

My wife says we split the equity and she pays £6k onto the joint loan and I pay the rest(!!!)

So I walk way from this with, at best £16,500 but I will have debts of 32,000

I am on a zero% rate for £10,500 of the personal debt until march 2017, the rest is on zero% until last month and for some reason in not getting charged interest yet.

I used the snowball calculator on MSE and it 61 years to pay that off! 'm clearly bankrupt. If I go bankrupt my ex is liable for that joint debt of £22000

So what do I do? If I don't go bankrupt I cant support a home that allows me to have my children to stay - if I do My ex will likely go bankrupt herself. Which option isn't awful

Hi there

Thanks for posting.

I understand that things are difficult for you at the moment and that it can be hard to see what the best way forward is.

When considering whether bankruptcy or any other debt solution are the right thing to do, it’s important to take into account all of your circumstances to reach the right decision.

If you’d like to contact us, we’ll be able to look at your situation and then give free advice on the best course of action to resolve your debt problems. Our contact details can be found on our website.

Kind regards

Allen

its_gone

Hi

I was made bankrupt in april 2013 i own my home with my spouse and have 2 kids 10 &16 the
(Not very) Trustee in bankruptcy has now made a appeal to the court to sell our house, my wife or anybody else in the family do not have funds to buy my share there is around 60-70k in equity we are paying the mortgage, is there anything we can do to stop them from obtaining the court order

regards

Starry1981

Hi, currently we are in an iva we started payin sept 15 but now I think we may have a problem paying mine and my partners iva was based on our income he's works full time and I get child tax/child benefit I've looked on the expenditure part and it includes both of my parts we currently pay £75 each a month but come April/may I don't think I'll be gettin much child tax due to my estimates being way out so will have been overpaid and will be paying that back to Hmrc so basically I don't think I'll be gettin much at all.....what we are worried by is that when my tax is reduced my partner will have to pay the the things I did that I used the money for so will leave us with no money after we've paid our bills food etc to be honest when this happens I will be having to reduce our food bills and anything else I can that's possible......so my question is if we can't make the payments can our ip make us bankrupt? we don't have any assets and tbh I'm starting to feel like I was at the beginning before we took the iva seeing no way out and scrimping and saving to try and live. We have read about bankruptcy and feel that's the only option as we don't see anything gettin better financially and it's upsetting me as I really thought we could do it

Would we have to pay for another 3 years after going bankrupt if we can't even meet our full iva payment a month ? This is one thing I am worried about as I never knew it could carry on for another 3 years

StepChange_Rachael

its_gone wrote: »

Hi

I was made bankrupt in april 2013 i own my home with my spouse and have 2 kids 10 &16 the
(Not very) Trustee in bankruptcy has now made a appeal to the court to sell our house, my wife or anybody else in the family do not have funds to buy my share there is around 60-70k in equity we are paying the mortgage, is there anything we can do to stop them from obtaining the court order

regards

Hi

Thanks for posting and welcome to the forum.

The Trustee has up to three years to release your share of the equity from the property. The main option for individuals when this happens who want to remain in the property is for a family or friend to buy their share of the equity. I know you’ve already explored this possibility and as this isn’t an option for you I’d suggest contacting the Official Receiver and asking them if there’re any other options open to you to remain in the property.

This is because bankruptcy is a case by case basis. It depends on your individual situation and circumstances as to the requirements and restrictions of your bankruptcy.

Kind Regards

Rachael