Need help - is bankruptcy the answer?

306chris

This is my brief history and I feel ashamed that I haven’t done anything about my situation. The long story short is that as a younger lad I took out credit cards and spent up on them and had a personal loan as well. I approached my bank who suggested a consolidation loan for all the debts however there was no stipulation about paying the credit cards off or handing them over. So in my early twenties my bank loaned me twice my annual salary with no guarantor, deposit or collateral. Like a complete foolish moron I was struggling with the repayments so did the daftest thing ever and started to use the credit cards again.
At this point I am still a single man (with a steady girlfriend) living at home with parents earning about 14k p.a. I can’t remember who suggested an IVA but that is what I took out after realising that I couldn’t go on. Fast forward a year into the IVA and my girlfriend and I are expecting a baby and my world is upside down. We need a place to live and all the things that go with a baby.
Eventually the IVA becomes unsustainable, I was forking out around £300 a month and just couldn’t afford rent on top of that as my circumstances had changed so much. The IVA is terminated in 2006/2007. I seek a little help from the CAB which basically resulted in me trying to negotiate with the people I owe money to. At the same time I had been made redundant from my job so I have only JSA coming in.


After the IVA was terminated the following happened
This is what I owe
A)[FONT=&quot] A -[/FONT]Personal Loan £30000
B - Credit Card £3100
C)C - Credit Card £2100
D)D - Credit Card £1500
None of the debts are incurring interest

A)A - repayment plan of £10 a month was agreed and at the current rate it’s going to take 250 years to pay back
[FONT=&quot]
[/FONT]
[FONT=&quot]B - B -[/FONT] They took a year to get in contact and like a muppet I have just ignored them. They send regular letters and make telephone calls but hang up when they get the answering machine.


C)[FONT=&quot] C - [/FONT]A repayment plan of £10 a month was agreed and there was a mess up about 6 months in and I haven’t heard from them since



D)[FONT=&quot] D - [/FONT]After the IVA was terminated they haven’t made contact and I haven’t attempted to either.



E)[FONT=&quot] E - [/FONT]Currently approx £800 in rent arrears with HT – They are happy with current repayments
F)[FONT=&quot] F - [/FONT]Had a letter from Orange saying they wanted £400 for a contract termination, then the same from a debt collection agency but haven’t heard anything for 24 months now.


My partner has the debts of her own coming to around £3000 for catalogues. She has negotiated a payment plan with them. She also has a small loan with provident less than £400 now.
The only thing we have on credit now are two mobile phones that on contract that we can’t get out of.
Work wise, I was self employed up until last October and had been for three years previous. My partner doesn’t work. I am currently seeking work and currently going insane being at home all day. Apart from a brief spell off work after redundancy I have worked full time all my adult life.

I have briefly looked into my debt problems however most organisations just want to sell me an IVA so it hasn’t got any further. I need to get things sorted as at the moment I am plodding along and getting nowhere. I have even been turned down for two jobs because of my credit history. I need help and need to know if Bankruptcy is the right option for me. I have tried to make contact with my local CAB but the waiting list is horrendous. The only other issue I have is that I do not have any of the IVA paperwork, I have turned the house upside down looking for it.

Many thanks in advance if you can help.

dancingfairy

B,C,D are not really the biggest problem as they would probably accept a settlement figure (one that might be managable when you get a job).
A is your biggest problem long term but the most important thing above anything else is to keep the roof over your head by sorting out the rental arrears.

Basically your options are:
1) a dmp
2) an IVA or
3) Bankruptcy

In terms of jobs, well bankruptcy isn't going to help if you have to pass a credit check but frankly if you're failing the credit checks now anway, then it's not going to be much different. It will also rule out certain occupations as well but its not likely to be much diffierent to having had anIVAin that respect.
Bankruptcy will make getting a mortgage in the future much more difficult but not impossible.
Assuming you have nothing of value such as a car then yes, on paper bankruptcy would seem to be a viable solution.
Have a read through the important info threads at the top of this forum. There you will find info regarding how to do a proper SOA and where to seek impartial advice about your situation (try StepCHange (formerly CCCS or try National Debtline)).
You will also need to raise the fees as well (about 700 ish I think although if you are unemployed you may not have to pay all of this but still a lot ).
Noone here will say yes you should go bankrupt or no you shouldn't as at the end of the day you have to weigh the facts up but certainly it seems as though it could be a sensible decision in your situation.
Best of Luck
df

dancingfairy

A short summary of the process:
1) fill in an SOA
2) get impartial advice from a debt charity
3) raise funds for bankruptcy
4) attend court with funds and copies of SOA.
5) Judge makes you bankrupt.
6) Judge makes an order for you to pay into your bankruptcy for the next 3? years based on your current situation.

Job done. Obviously there is a little more to the steps but that's a brief summary. More info will be on the help topics at the top of the board.
best of Luck
df