Bankrupt or Stick it out?

winnieroos

After some advice please as it feels as though i'm on the never ending road of paying off debt!

I'm currently on a DMP with Payplan due to working hours being reduced I couldn't meet my financial commitments (around 3.5 years ago). I'm now back on full time and pay around £150 per month towards my debts. My husband also has debts included in this DMP but nowhere near as much as me. It currently shows that I owe around £13k on loan, £700 on an OD, £6K on credit and store cards. We are up for our annual review and should be able to increase the monthly payment by around £100 but its still showing over 10 years to clear the debt. We aren't pestered by creditors anymore and have never had any CCJ's.

I've recently started losing the light at the end of the tunnel in terms of my debt and wondered if Bankrupcy would be an option and if so, how much it will affect my property? We own our own home and have a mortagage of £118,000 plus around £2.5k (would be less on settlement figure) secured loan which gets paid off in Sept 2014. The property is possibly worth £135,000 MAX. We don't have any savings and just one car which we need for work which is worth around £2,500 which I understand we could keep as it's needed for work.

Any advice would be really appreciated as I have that sick to the stomach feeling and as I say, the light seems very dim!

Many thanks:(

winnieroos

I also forgot to add that we have never missed any payments on our mortgage or secured loan.

thriftylass

Hiya,

I'm sorry you're having a tough time but I would stick it out. About 20k isn't worth going into bankruptcy for. Apart from the fact that you spend the money and need to pay it back bankruptcy is not the easy way out is seems. Ten years seems a lot but then I can highly recommend some of the debt slaying forums, where people have similar debt and clear it in half the time. Sell everything you don't need, start ebaying etc etc every penny counts. There are loads of lovely people on here with advice where to cut corners, how to stop spending and how to manage to overpay even more. See the positive side, you're back in full time work and the creditors stopped pestering you. Make the most of this.

arcon5

thriftylass wrote: »

Hiya,

I'm sorry you're having a tough time but I would stick it out. About 20k isn't worth going into bankruptcy for. Apart from the fact that you spend the money and need to pay it back bankruptcy is not the easy way out is seems. Ten years seems a lot but then I can highly recommend some of the debt slaying forums, where people have similar debt and clear it in half the time. Sell everything you don't need, start ebaying etc etc every penny counts. There are loads of lovely people on here with advice where to cut corners, how to stop spending and how to manage to overpay even more. See the positive side, you're back in full time work and the creditors stopped pestering you. Make the most of this.

I disagree. I think it depends on each individuals circumstances, such as level of income, future prospects etc.

arcon5

winnieroos wrote: »

After some advice please as it feels as though i'm on the never ending road of paying off debt!

I'm currently on a DMP with Payplan due to working hours being reduced I couldn't meet my financial commitments (around 3.5 years ago). I'm now back on full time and pay around £150 per month towards my debts. My husband also has debts included in this DMP but nowhere near as much as me. It currently shows that I owe around £13k on loan, £700 on an OD, £6K on credit and store cards. We are up for our annual review and should be able to increase the monthly payment by around £100 but its still showing over 10 years to clear the debt. We aren't pestered by creditors anymore and have never had any CCJ's.

I've recently started losing the light at the end of the tunnel in terms of my debt and wondered if Bankrupcy would be an option and if so, how much it will affect my property? We own our own home and have a mortagage of £118,000 plus around £2.5k (would be less on settlement figure) secured loan which gets paid off in Sept 2014. The property is possibly worth £135,000 MAX. We don't have any savings and just one car which we need for work which is worth around £2,500 which I understand we could keep as it's needed for work.

Any advice would be really appreciated as I have that sick to the stomach feeling and as I say, the light seems very dim!

Many thanks:(

So you have up to £17k equity in your property and debts of just short of £20k. Based on this alone, personally i'd be very reluctance to declare BR where you could potentially sell your property and be left with little debt.

Perhaps you could make full & final settlement offers to some smaller creditors? Give them a choice of settling early or waiting up to 10 years. If the debts small enough, some may decide it's not worth the administration over the years. Although obviously no guarantee as some may decide they'd rather get the full whack over a longer period than settle.

Also consider whether you would want to move house... as the receiver is likely to take an interest in your property so if you can't afford to buy their interest in it they may well decide to put the property on the market.

IF

Hi winnieroos and welcome to the Bankruptcy (BR) Board. 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.


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

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