Voluntary or involuntary Bankruptcy

syvci

Right, here's my situation. Im 30 years old and am very ashamed of my debt. It totals arouond 55K all my debt in unsecuered. I have previosuly made arrangements to tackle my debt by working with PAYPLAN who were really useful and were a very sympathetic and non judgemental orgainsation. However with the amount of debt being so big I gave up paying my agreed 150PM after repaying around 3k total. I have not made any payments for around a year. I recieve phone calls from various debt companies but dont answer the phone a lot of the time. I realise that im running away from the problem but its the only way to some extenet that i can function day to day. Ive just moved in with my mother and am worried that if the debt collectors find out where i live that they will cause trouble by calling round the property etc. However to counter act this ive read about a 'statatary declaration' that outlines what items are mine so that if the worst happened they could take anything that didnt belong to me.

Im at the point where i havenet had any credit for 2 years and couldnt obtain any anyway and will never be able to pay such an incredible amount of money off. Im almost waiting to be made bankrupt but its doesnt seem to happen. Im aware that i can go bankrupt voluntarily but there is a cost of around £900. Can anybody explain what is teh worst case scenario with bankruptcy? how long can they control my income? is it one year or more? Is it best to go volunatrily and will this mean more favourable treatment? any help and advice you can give is much appreciated. Many thanks

sniggings

First thing to do is get advice from a helpline as they will take all your details so can give a fuller answer of what is best in your situation, CCCS debtline and CAB are 3 good ones, try all three to see which one you work better with, if you go BR you have to have sort this kind of help, so it's worth doing just for that reason alone.

It costs a creditor more for them to go to court so tends not to happen, unless they think they will get some money back, which in your case sounds unlikely.

Doing it yourself is the best option imo as it allows you to set the time scale, so can save for depoits on flats etc

How it works is, they allow you reasonable living expenses, such as travel to work, food rent gas, a small holiday, haircuts, cloths etc and after all that, if any left over they take it for 3 years, if your income goes up, so does your payments, if income goes down so does your payments or they can even be stopped, but once the 3 years is up, you stop paying the excess.

If they decide you do not earn enough to have excess income, then after 12 months you are free and clear, if within those 12 months your income goes up and you have an excess then once a payment plan is started the 3 years starts from then.

Remember it's only excess income that you pay, so you will be debt free, allowed all your food, rent etc etc so not too bad at all.

Sounds to me that you are coming around to going BR, which will stop the calls, and any doorstep calls, and letter, and most importantly stop you from stressing, even if they don't take you to court for BR, they will go to court for county court judgements, bailiffs etc so doing it yourself, if BR is right for you the best thing you can do.

syvci

Hi and thank you for the advice. I dont earn loads around 17,500. Will it be likley that i would have my money controlled for 1 year or 3? I could handle 1 but 3 seems like a long time ;-( . I think that im going to try and save a bit then go bankrupt myself just to draw a line in my finances and make a fresh start in my life. How strict will the reviever person be? will i be allowed a reasonable amount of money for food and clothes etc or will i be very hard up and have a very low standard of living? Once again any help anyone can offer is much appreciated.

sniggings

the figures are not set in stone, as they are meant to look at each case on it's own merits.

Depending what your rent is, £17,500 for a single person is likely to get an IPA but as I say, rent, travel to work, childcare etc etc are all allowed, one persons rent can be £80 a week or in a more expensive area it could be £160, each are allowed if the rent is around the average for that area. So 2 people could both be on £17.500 but one of them might not get an IPA

TBH with you, unless your rent is high or you have another allowed expense such as child care or high fuel costs for work, the chances are on £17,500 for a single person you will get an IPA but you never know, it all depends on the OR that does your case.

Best bet is start a new thread, copy and paste this in it and fill in the details, we can then go through your expenses and see what you are likely to pay, if anything.
http://www.stoozing.com/msoc/soacalc.php

National_Debtline

Hello there.

Although the actual period of bankruptcy is usually twelve months it is generally the case that your Income Payment Agreement will last for three. You should only be asked to pay into an Income Payment Agreement should you have the spare money to do so.

You can read more about bankruptcy via our fact sheet, you can find it here:

http://www.nationaldebtline.co.uk/england_wales/factsheet.php?page=01_bankruptcy

Best wishes,

David.

IF

Hi syvci and Welcome to the Bankruptcy (BR) Board. As sniggings has said your first step is to make a list of all your creditors, debts and assets. Secondly and most important is contact one of the following debt charities. Please try these they don't charge and are impartial. They will go through all your options with you and if they suggest bankruptcy then come back to this board and we will help you all we can. Also if your not ‘clicking’ with one of the Debt charities do try another. We advise you to try at least two others for your own piece of mind.
Your BR could be refused if you have not sought advice. (Advice on here does not count, this has to be from one of the Debt Charities, an IP, an Accountant or a Solicitor. The Judge just wants to be sure that you can never come back and try and overturn the order on the basis that you were not aware of all the consequences).

* Blue text on this forum usually signifies hyperlinks, click on the blue links below *

Main recommended sources of help:

• National Debtline - Website: National Debtline Telephone: 0808 808 4000
• Citizens Advice Bureau - Website: Citizens Advice or visit your local CAB centre (find nearest)
• StepChange (formerly CCCS) - Website: StepChange Telephone: 0800 138 1111

Others:

• Business Debtline
  - Website: Business Debtline Telephone: 0800 197 6026
• Christians Against Poverty
• PayPlan
• TaxAid - Help with tax debts.

Please don’t do anything rash take your time and weigh up your options and read everything you can.

We often ask you to post your SOA so we can see if you have included what you need to:-
MSE SOA Calculator - Click here
Select the MSE format at the end. Copy and paste onto your thread.

For ‘essential’ BR info the ‘Look here first’ sticky by Fermi.

BR friendly home insurance thread.

BR Friendly Bank Accounts ~ [Updated Sep 2012 re: Co-op Cashminder withdrawal]

BR Abbreviations

Beth's Guide Reasons for your BR

Charities who help with BR Fees

Bankruptcy NDL Guide

Basic Bankruptcy Advice & Guide NED CAB

If you are new/old to this board and receive/see a comment that is not helpful or insensitive please don’t let it put you off posting, often these comments are made by people who don’t normally contribute to this board and don’t speak for us.

What to do if you get an insensitive or hurtful comment.

And do remember we’ve all been through this and anything you don’t understand don’t be afraid to ask.


Best wishes
IF...x

syvci

Right - im going to post all my debts etc on here later today. I dont have any assets now my house is sold. Details to follow. Thanks for your help

syvci

Here is a list of my debts; do they take debts to friends into considerations? Based on my current circumstances will i get a one year or 3 year plan if i go bankrupt? what if i got my own place to live? Please let me know what your thoughts are

Barclays Bank Plc – £489.00
HBOS – £ 3,928.71
Link Financial Ltd – £7,630.00
Moorcroft Group Plc - £3,459.00
NRAM - 58250N11816 - £23,422 (joint debt with ex from sale of house)
Natwest/RBS – £1,400.99
Natwest/RBS - £ 1,303.03
Paragon Personal Finance Ltd – £ 4,934.00
Wescot Credit Services - £ 1,992.87
In addition i also owe around £1200 to HMRC which is gaining interest

Here is my current income (temp cpntract till July)

1200 - Wage

80 car insurance
160 travel expenses
160 food
20 gym
50 Mobile Phone
25 Virgin Media
70 (council tax back payments (only two months left to pay)
200 rent (just moved in with mum although this will not be permenant)
10 Haircuts
30 - football subs

total - 780

sniggings

syvci wrote: »

Here is a list of my debts; do they take debts to friends into considerations? Based on my current circumstances will i get a one year or 3 year plan if i go bankrupt? what if i got my own place to live? Please let me know what your thoughts are

Barclays Bank Plc – £489.00
HBOS – £ 3,928.71
Link Financial Ltd – £7,630.00
Moorcroft Group Plc - £3,459.00
NRAM - 58250N11816 - £23,422 (joint debt with ex from sale of house)
Natwest/RBS – £1,400.99
Natwest/RBS - £ 1,303.03
Paragon Personal Finance Ltd – £ 4,934.00
Wescot Credit Services - £ 1,992.87
In addition i also owe around £1200 to HMRC which is gaining interest

Here is my current income (temp cpntract till July)

1200 - Wage

80 car insurance
160 travel expenses
160 food
20 gym
50 Mobile Phone
25 Virgin Media
70 (council tax back payments (only two months left to pay)
200 rent (just moved in with mum although this will not be permenant)
10 Haircuts
30 - football subs

total - 780

we don't need to know your debts, as the repayments are based on being debt free post your BR.

As said you will get better help if you make a new thread and use the link I supplied, copy it then paste it in a new thread, then fill in your income and expenses post BR remember you will then be debt free.

and yes a debt to a relative is treated the same as any other debt, you can not pay them back at the expense of other debts, so they are included in any BR, it's up to you, if you have any spare income whether you choose to pay relatives back but as said it's not allowed, as all debtors have to be treated the same i.e if you have any spare funds the payment has to be split between all your debtors

going by what you have put, it seems you will have over £400 a month spare, so yes you will get an IPA but try and use that link as it's easier for people to see whats what and change things around a bit.

You do know that any joint debts will pass to the other party if you go BR and they don't, if the other person is not aware of this then make them as they may choose to help you pay of those debts, as once you take away the joint debt the money you owe may be managable or BR may not be the best option, there are debt relief orders, IVAs and coming to an agreement with your creditors.

oh and make sure you pay fair rent to your Mum, if she is doing it cheaper because you are her son, then there is no point in that, as any excess income will be taken, so in effect your Mum will be paying towards your BR debts, so if £50 is fair then Ok but would she charge someone else £70 or £80 a week?