Sole trader 23 facing bankruptcy

Denzel1989

Hi all,

I have been on here before in search of advice and i am back again!!

I have a small groundworks and construction business.

Business was going really well the latter part of last year, i was paying my debts off and actually getting somewhere, i got my debts down from approx 35k to 20k.

Anyway we had ALL of our work cancelled late November, alot of reasons why, one customer was diagnosed with cancer, the other couldnt sell their house to fund the project and some just plain couldnt afford it.

I have worked one month in the last 4 and i am absolutely skint.

So my question is is bankruptcy an option? if so what happens to my bank accounts, mobile phones things like that?

what are the consequences?

I owe 20k i have no assets, no vehicle, im using a borrowed van from a friend, nothing worth selling that i havent sold already to help the situation.

My overdraft and credit card are both maxed and it doesnt look like these jobs we had planned are going to come for a good while, and even if they did i wouldnt be in a fit financial state to undertake them anyway.

Ive been in business since i was 17 and it has been an awful struggle since, i have met a fantastic bloke, who has helped me out and said will continue to help me out but i will just end up owing him money, basically running up credit in order to live.

Im not sure if i can go on struggling anymore and i cant see a way out or any light at the end of the tunnel.

What to do?

SEE

DanielN1989 wrote: »

Hi all,

I have been on here before in search of advice and i am back again!!

I have a small groundworks and construction business.

Business was going really well the latter part of last year, i was paying my debts off and actually getting somewhere, i got my debts down from approx 35k to 20k.

Anyway we had ALL of our work cancelled late November, alot of reasons why, one customer was diagnosed with cancer, the other couldnt sell their house to fund the project and some just plain couldnt afford it.

I have worked one month in the last 4 and i am absolutely skint.

So my question is is bankruptcy an option? if so what happens to my bank accounts, mobile phones things like that?

what are the consequences?

I owe 20k i have no assets, no vehicle, im using a borrowed van from a friend, nothing worth selling that i havent sold already to help the situation.

My overdraft and credit card are both maxed and it doesnt look like these jobs we had planned are going to come for a good while, and even if they did i wouldnt be in a fit financial state to undertake them anyway.

Ive been in business since i was 17 and it has been an awful struggle since, i have met a fantastic bloke, who has helped me out and said will continue to help me out but i will just end up owing him money, basically running up credit in order to live.

Im not sure if i can go on struggling anymore and i cant see a way out or any light at the end of the tunnel.

What to do?

I don't know anything about bankruptcy, just wanted to say sorry, really feel for you. Life is so damned awful for a lot of people at the moment. I hope you find what you need.

lilybankrupt

Hi there, like you I am a sole trader and likely to go bankrupt later this year. For what it's worth here's what i've learned so far....

- the Official Receiver cannot stop you trading at least in theory, and 'tools of the trade' and are exempt as assets provided those tools are creating an income

- trade credit will be really difficult - you can't take credit over £500 without letting the person know you are bankrupt (and any credit checks will obviously show the situation anyway)

- a 'normal' business bank account is unlikely to be available, i've just opened a CashPlus card account (no credit checks ) which sort of acts like a bank account and can be in the business name - but they can't handle cheques in or out

- mobile phones, it seems like people have a mixed experience on this one, some providers terminate the contract, others are absolutely fine. I think a new contract is unlikely for a few years?


There are lots of other questions though, i'm by no means an expert but the first thing that occurs to me is whether you own a house? If so and there's equity the OR might want a sale to release the equity for the creditors - but that depends on all sorts of things.

Mouse1812

Martinthomas wrote: »

You will also need to trade in the name after bankruptcy that you were trading under pre bankruptcy

Why? there is no legal requirement to do that. The only legal requirement is to notify anyone you deal with (presumably take credit from) that you are an undischarged bankrupt. That does not prevent you from trading under a different name.

bonio83

Sorry I cant offer proffessional advice but if I was you I would be closing the business down.

You have been doing it for 6 years and you say it has been a struggle since you started.

I could understand you struggling on if you were making good money but it has just got you into large debts.

I think you have 2 options.

1. You go bankrupt and have a major effect on your credit rating in the future (major problem if you plan on purchasing a house)

2. You speak with the companies that you owe money to and explain your situation. Let them know that your wanting to pay off the debt but you would have to pay it off in installments once you find a job. They are basically in a situation where they either accept small installments or you go bankrupt and they get nothing anyway.

How many different people/companies are included in your 20k of debt?

tigerfeet2006

Ring Business Debtline and get some free, professional, imPartial advice.

dojoman

FOA Martinthomas, why do you have a website address for another BR "advice" site in your location on the left side of the page. Is this another free website or do you have to pay for the advice/help.

tigerfeet2006

And do you know that it is NOT allowed and breaks this sites rules.

Mouse1812

Not got time to look closely now but don't like what I've seen so far, that site looks dangerous to me.

" If your house contains no equity at all, the Official Receiver will still take possession of the house. However, once this has happened, it is possible for a third party (relative or friend) to approach the Official Receiver and offer to buy back the title to the property for a nominal sum of £1 (plus the cost of solicitor’s fees)."

So wrong on several points, no doubt others will spot other things before I get back. I'm not going to repeat the link, best avoided I think.

edit to add: if you are wondering what this is about the poster, his comments and link to a bankruptcy site appear to have been removed (thank god).

tigerfeet2006

Yep! I was just coming back to say that info on the site was wrong. Closed the link on my browser now as I don't want to give them any more traffic.

Mouse1812

I'm tempted to give them a call later for some free advice !