The "what do you need to know before you go bankrupt?" thread!

gettingitsorted

ClaireLR wrote: »

Ok I have filled in my reason on the forms where it says what is the reason you do not have enough money to pay your debts and I have written as follows: -

I overcommited on credit cards and loans when I was younger and lived with my parents. At the time I could afford to pay my creditors with no problems as I didn't have any real living expenses. I had loans and credit cards which I was managing to pay off in full sometimes.

Then I met my ex-partner and eventually we decided to move in together in April 2006. This is when I started to struggle with my debts. We started a Debt Management Plan together through Payplan as he also had debts. We were managing quite well and paying almost £700 a month towards our debts. We then split up and I was left again to pay my debts on my own. By now I had other expenses to consider than those I had when living with my parents such as rent and utilities and began to struggle. I spoke to Payplan who advised me to start a Debt Managment Plan alone. They worked out that I would pay £90 a month. At that rate it was going to take more than 20 years to pay off my debts but I agreed as I wanted to pay my debts off.

Further to this I then had an unexpected Vets bill for an illness that occured before I took out my Insurance policy and this was for £350. I had to pay this bill so I spoke to Payplan who advised me to reduce payments to them to £40 and pay the other £50 to my vets. The vets agreed but since I have reduced my payments to Payplan I have had solicitors letters, default notices and telephone calls from some of my creditors wanting more money that I cannot afford to pay. Some creditors are still adding interest at a rate that means my payment does not even cover the interest that is being added.

Does this sound ok or is it to much/little information?

Hi Claire ,

it really does not need to be that long just points would be fine as if the OR need to know more they will always ask .

ClaireLR

What would you advise, shall I just put:

Overcommitted on credit cards and loans when living with parents
When I moved into my flat couldn't afford to pay them
Entered a DMP
Interest still accruing which payments do not even cover.

Is that enough do you think?

gettingitsorted

yeah that should be fine claire

allofadither

That sums it up nicely Claire!

ClaireLR

Thanks peeps!

owetoomuch

ClaireLR wrote: »

Thanks owetomuch! So basically I will have to pay the extra I am taking home in my pay due to not paying tax until the end of the financial year, but they will only set an IPA for 3 years if I have enough surplus, is that right?

Yes I think that is correct. IPA only set if after OR has checked your SOA and is happy with it and you have more than £50/£100 available they will set IPA for 3 years.

ClaireLR

Thanks OTM. I'm finding things out about BR every day now which didn't even occur to me when I first thought about making myself BR such as this. Fancy paying no tax!? Alright I wont see any of it but still, didn't think you could not pay tax under any circumstances!

I have another, possibly daft question. Just filling in parts of the forms online and its asking about properties I rent. My flats rented and it's asking about the land type, freehold or leasehold.

I aint got a clue! Can anyone tell me the difference so I know what to put?!

owetoomuch

If you are not too sure, check your agreement, if it is not in there leave blank and the people at the court will help you.

ClaireLR

Just filling in the forms online and it's asking for the Tax office address.

Does anyone know where I'd be able to find this out without asking my employer?

philnicandamy

http://www.hmrc.gov.uk/local/index.htm

if you have a payslip you'll need the first 3 digits of your tax code to search this should give your tax office