Bankruptcy with no missed payemnts

saranomoredebt

Hi all,

I have few questions, and I hope you can help me. Briefly about myself, I took two loans to fund my studies, and then end up taking more credit cards, and overdrafts to fund my living expenses. I have been paying these for long time, some of the credit cards they go as far as 1998, missed the odd payment here or there but I just could not afford to pay more than a minimum. I got married and my husband was out of job, he tried hard to look for a job we applied everywhere but no luck, then he found some private tuitions for teaching a foreign language, the problem is his travel expenses was added on our expenses and what he get a month got eaten by all the debts, which made me use payday loans, now I am on cycle of rob Peter to pay Paul. I also took part time job to just survive but it was seasonal, and my health suffered with no rest, with the worries added about my debts.

So far I have no missed payments, except one last month, I can see that next month I will need more payday loans to survive again! For the last five years I have not lived, all my salary go towards my debts, and any extra emergency payment will kill me, for example last month my husband broke his glasses and needed money it to fix it, an extra money that month was a killer.

It never occur to me to be bankrupt, as I always dreamt to have a mortgage one day, my best friend did iva 3 years ago and advised me to do it, she told me she used to pay £900 a month but now only pays £400, I was against the idea, and I thought it is my debts and should pay it, and the hope of my husband finding a full time job and help me to be debt free. My salary is really good but now after paying just debts, I am -300 every month ! all payments go at the beginning of the month except my rent and council tax, which go in the middle by that time, I have no money and take a paydaloan.

I went to my local CAB but the adviser took my number, and gave me some leaflets, and told me that someone will call me, to discuss my problem, so I am still waiting, so now my questions

1. Next month I cannot make most payments, do I chose who I pay, or what do I do? Do I pay them equally even if it less than minimum payments?

2. Since I have no missed payments, is bankrupt not an option for me, even though I am struggling?

3. I have joint account with my husband but no debt involved in this account we will close it now, does that effect him.

4. My husband self employed but his salary is not guaranteed, depending on what work he can get, does his earning get included in my SOA

5. After paying rent and council tax and bills, I understand I have to pay all my disposal income, since I have been living on nothing I really do not understand how much I can live on without been a problem, as I have essential things that I need like a jacket for the winter that I could not afford.

I have read a lot here but the whole process is too confusing for me, do I open a basic account and transfer my salary to it now?? Which debt is more important, payday or credit cards or loans??

Thanks in advance

PippaGirl_2

You need proper legal advice as to what is best for you in your own circumstances. Is your CAB appointment soon? If not, do phone National Debtline or Stepchange for advice. Don't pay anyone to help you organise anything such as a debt management plan or to prepare for bankruptcy. A DMP might be a good place to start as that will immediately free up money to live on and release the pressure which will give you time to decide whether to take more 'serious' action such as BR.

saranomoredebt

PippaGirl wrote: »

You need proper legal advice as to what is best for you in your own circumstances. Is your CAB appointment soon? If not, do phone National Debtline or Stepchange for advice. Don't pay anyone to help you organise anything such as a debt management plan or to prepare for bankruptcy. A DMP might be a good place to start as that will immediately free up money to live on and release the pressure which will give you time to decide whether to take more 'serious' action such as BR.

Thank you for your prompt reply, I think I have made my mind about bankruptcy, and even if I have to pay for 3 years, better than the 5 years for DMP, so if I decide DMP I can change to be bankrupt?

PippaGirl_2

Yes, initially many people start a DMP, I started mine through the CAB which they do all the time. I paid the monthly installments for about 18 months until I was mentally well enough to face what was inevitable really. CAB had mentioned BR given my circumstances but you need to have a certain amount of inner strength to do it I found and I had other battles (housing & supporting children) that needed what strength I had.

If you are sure about BR, then do seek the legal advice through CAB or whoever to confirm (the Judge will almost certainly expect you to have sought advice and not made the decision alone) and then get the forms and proceed.

Once you've made your mind up, many people stop making payments to creditors in order to gather the £700 fees together.

Open a Co-operative bank Cashminder account asap and get your income paid into there, that account won't be frozen on BR.

If it's just you and not your partner going BR, try to sever any financial links, change joint accounts into single ones otherwise your BR will affect his credit rating for the 6 years too.

saranomoredebt

Thank you pippaGirl, you are a star, went to co-operative branch to open the account today and I was told it is not done through a branch anymore, so they put me through the phone, and I was told it is not done through phone too!!! Only through post, they will send me the application!!

I have Barclays account but it is doormat account, my salary does not go there, I just could not pay my overdraft so I just pay the interests monthly, can I ask them for basic account?? But they will be one of the creditors later.

PippaGirl_2

They may well still allow you a basic account despite being a creditor. I'd prefer to jump ship though and use Co-op, worth waiting for BR to get your application in there. The Co-op cashminder has internet access for undischarged BR's and you can set up and change standing orders and make bank transfers online, whereas generally Barclays basic doesn't come with internet banking while undischarged. Strange that the Co-op branch didn't hold the forms, that is weird.

moneymakestheworldgoround

saranomoredebt wrote: »

Thank you pippaGirl, you are a star, went to co-operative branch to open the account today and I was told it is not done through a branch anymore, so they put me through the phone, and I was told it is not done through phone too!!! Only through post, they will send me the application!!

I have Barclays account but it is doormat account, my salary does not go there, I just could not pay my overdraft so I just pay the interests monthly, can I ask them for basic account?? But they will be one of the creditors later.

I have had a nightmare with them too! Rang up the helpline yesterday, told couldnt do it over the phone and I had to do it online. I said you cant do the cashminder online and the lady disagreed. So she went online and say oh yes you are right. Well you need to go in the branch because we cant key them in over the phone any more.

So travelled miles to nearest co-op because lady said you cant do it in the Britannia branches. Got there and they said, no you need to do it over the phone. I explained they said no, they cant due to change in recent procedures. So I said I was told I could do in it branch. No, cant do that, you'll have to do it online. Me - No, you cant do it online - yes you can, no you cant and so on... Then they said sorry but you'll have to get a pack sent in the post. So I said ok, can you order it for me. Umm, no you'll have to ring up the helpline.

AAARGH

PippaGirl_2

Wow, seems like Co-op are starting to hinder the opening of Cashminder accounts. That is not good!

saranomoredebt, out of interest, when you went in to open the account was it a Co-operative Bank you went into or a counter within another like the Britannia moneymakestheworldgoround just mentioned? I'm wondering if that makes a difference.

saranomoredebt

I thought that too, yes it was Britannia, the girl on the phone asked me which branch I was in, looking at the website there is a branch near me which is co-operative, I will try that, and update how I got on.

moneymakestheworldgoround

Just called the Co-op to order the pack and she said go into branch Explained I had and they thought I could do it online and on phone blah blah blah and she said all procedures were changed weeks ago and all branches should be aware that they are unable to open accounts over the phone. She has emailed her manager to request a blanket email is sent to all co-op branches to reiterate this to staff and avoid any future confusion. She was lovely.

Fingers crossed I get the packs !

PippaGirl_2

Oh good, mmtwgr, glad someone felt it important to tell the in branch staff how to do things!

snmd, will be interesting to hear if main CO branches are different. Common sense tells me you ought to be able to open a Cashminder there.