Going bankrupt with family

shulme13

Hi all
Hope someone can advise me,
We own our house with mortgage of 63, 000. The value is around 60, 000currently. We have unsecured debt around 30, 000, for the past 6 years we have gone from ccs to first step finance on a debt management plan although our debt has not changed if not now own more. We have a car on finance we can't upgrade due to the mileage. We have a 2 bed terraced house but have 2 kids a boy aged 5 a girl aged 9 and a half. We have looked at private renting and selling the house as we need a 3 bed but an estate agent does credit checks and I feel we would fail this. We have gone on the council list but due to privately owning our house we are the least priority. I am now thinking to go bankrupt for a fresh start, although have worries. I believe the bank accounts get froze, this would be our income for paying for a privately rented house. We went to las vegas may 12 as my husband had a better job but got made redundant in October 12 and is now working at a supermarket on alot less money and we are now struggling. I don't know what the first steps are to going bankrupt and how it will be worked out, do I stop paying bills now to save to go bankrupt?, how do I get the forms? We also have my brothers car in our name that he leant us as we were struggling I wouldn't want them to take his car. We will need a car to comute to work or do they say give you some money back to get a car?

arcon5

RE: The house
In negative equity the receiver will not be able to realise anything from it. You may even be able to keep it.
If you don't want it, different agencies have different policies post-BR, many requiring guarantors. Look around locally, a scarce number of local firms will charge admin fees once the application is successful rather than on-application. (Just don't mention your intentions to them).

RE: car 1
Is this on finance? lease agreement? If so they may take the car back anyway.
If owned outright, if under £1k (not a figure set in stone) you can usually keep it. If say £5k they may sell it and give you £1k back. If say £1500-£2k it's debatable. But you can of course offer to buy their interest in the car.

RE: brothers car you use
Just explain to the receiver you are the registered keeper but don't own it, it's your brothers. You should have him confirm this in writing for you, possibly provide them a copy of his original receipt with his name on and show the previous registered keeper was him to try substantiate your story.
But they can't really take his car.

RE: bank accounts
Take enough cash out for living expenses.
Open a Barclays cash card account. They are BR friendly and if you do it in branch you should get account details same day to give to your employer.

RE: steps
Phone CCCS or another debt charity for impartial advice so you fully understand the implications of it! (such as IPAs, restrictions etc)
Fill in forms.
Take to court, pay the fee.
Going to the county court is the easy bit, usually out in 20-30 minutes in some courts.

Forms:
https://www.gov.uk/bankruptcy/applying-for-bankruptcy

RE: saving for BR
Usually people stop making payments to creditors, particularly non-priority creditors (ie CCs, ODs, etc) and put the money to one side.
If you are surrendering your house (you need to also understand council tax rules if you are moving to rented accommodation as banks try to force you to sign paperwork post-BR before taking it back (never ever sign it) as you may be liable for it whilst it's empty), then you can usually get away with stopping mortgage payments.
As for priority bills, such as electric and water, if they are solely in the name of the person going BR, you could stop paying these I suppose and just include them (I did anyway).

RE: beware bank off-setting rules
If you stop paying mortgage for example then use an account with a bank you don't owe money to as they may offset your account with the missed mortgage payment.
If you owe every bank money, just open a CashPlus account or something.

shulme13

Thanks for replying it's really good helpful. If we moved into rented accommodation post BR would I need to pay my bills by cash or would I be able to pay DD by my basic tsb account, which we owe nothing on. My husbands account is Halifax with £600 overdraft, would I best moving everything over to another basic account post BR? I was worried we wouldn't be able to pay bills on the rented property if they froze the accounts, I wouldn't want to not pay my rent on the new property then end up in more trouble. Thanks again

shulme13

Sorry also what are the limits when I fill out the forms for expenditure, ive heard you can put money down for things like saving for holidays? Do I need to take all the money out of my bank accounts to stop companys taking it post BR as both me and my husband are needing to go BR which is looking like nearly £1, 400 for BR fee's. I will need to try and get this together as we have no money at all. Thanks

PippaGirl_2

Almost all bank accounts will be frozen once the bank hears that you have gone BR. The 2 exceptions are the Barclays basic and the Co-operative cashminder accounts. The cashminder is preferable because it offers internet banking which is very useful but this account can only be opened before you go BR so I would open a cashminder account asap and set up your banking with them.

There are numerous threads on suggested limits for your SOA on this board and info in the stickies at the top of the forum. A lot of people post their SOA on the board so people can offer advice as to what the OR is likely to allow or likely won't. So do feel free to do that nearer the time, in the meantime do get advice from the CAB or other free debt advisors as to what is best for you in your circumstances.

shulme13

am I better taking the cash out of my accounts and keeping hold of it for paying bills and bankruptcy. how much is it to go bankrupt, we will both be going bankrupt. Thanks

luvchocolate

you are asking for the whole experience I would suggest you read all the stickies on here also the insolvency website, read, read then come back for the things you don't understand and we will help but please read these first, also speak to one of the debt charities x

alastairq

If you really need to move from your present house, then cease mortgage payments, and put towards rent and deposit.

It takes a mortgagor many months to actually achieve re-possession, so you can remain where you are for now, using the time to save money for BR fees {£700 each..assuming both of you are petitioning BR?]


Locate a suitable rented home before petitioning BR [there is no rush for BR]....you will probably pass an agent's credit check, and the longer you remain where you are now, the better from that point of view [you establish reliability, amongst other things, by living in one place longer]

Contrary to what you imagine, the BR petition is the final act, not the first.

As luvchoccy says, read the stickies at the top of this forum...research is what you need to do most.

This alone will allay a million-and-one fears.

arcon5

shulme13 wrote: »

am I better taking the cash out of my accounts and keeping hold of it for paying bills and bankruptcy.

As advised, establish the ground works before attending court to petition.

Open a co-op cash minder account, Barclays cash card account or a CashPlus account (do not choose one if you have a debt with them), then have wages etc paid in to it.
The receiver should allow you to keep the account and these banks are known to not close them after BR.

But when petitioning withdraw enough money to live on for a couple of weeks (although it's usually much quicker than that).

how much is it to go bankrupt, we will both be going bankrupt

£700 each.

alastairq

to add....from posts on other threads [associated with banks in BR]....Barclays [to my knowledge] will not close a basic account on BR simply because they are creditors from other accounts...