going bankrupt help please

sally42_2

First off I've been reading these forums for a few weeks now and would like to say how helpful and friendly everyone is some of the situations have really moved me to tears.

Anyway heres my story and hope you friendly lot could help with a few answers please

My Husband and me have been apart for 3 years and now we are getting back together again. We have about 16k of debt and decided to enter into an IVA to clear this but after being told to stop paying everything to our creditors we then received a letter saying they could not do an IVA as my youngest who is 15 would be 18 before the 5 years were up and our tax credits would have ceased and we needed that money to pay the monthly payment(must admit was really annoyed they had said stop paying everything before it was all finalised and the fact this wasnt picked up on at the beginning of events)

They decided on forwarding our case to a debt management plan which decided we had £363 left over and that would be our payment we can't afford this and have decided to both go bankrupt, i know we have to do seperate applications but when it comes to putting down rent payments etc. on our I&E form do we split the payment between us or does one of us put them down please?

I've got an attachment of earnings for £100 per month for council tax and a payment to a bailiff of £140 for council tax which have obviosly been kept up to date will this go against me as favouring one debt over another please?

Also what if i pay my bankruptcy fee and then they say you can't go bankrupt is this likely?

TIA for your help

Sally

Rafter

Sally,

£16k is a relatively small sum to go bankrupt with, particularly if one or other of you are in work.

Remember that under an IVA or DMP you will not be having to pay your existing loans and other repayments but just the one payment to cover everything.

I suggest you get second advice from someone like payplan or CCCS about your situation. It sounds like you have not been that well advised so far.

You should put down on your bankruptcy form your share of household expenses if there are more than one of you in the house.

Paying your council tax arrears preferentially will not count against you as they are a priority debt and non-payment could lead to a criminal prosecution.

As for whether you bankruptcy will be approved, if you have taken advice and explored your other options and have rulled out an IVA or DMP then there is no reason why it shouldn't be.

Have a good look at the DMP proposal and see why they have come up with such a high amount per month that you think it unaffordable. A bankruptcy may be the best option but it will make getting loans or a normal current account difficult or impossible for the next 6 years and may have consequences you have not thought through.

Worth checking out piggybankrupt.co.uk for advice too.

Good luck

R.

NekoZombie

Yes, to some extent I'd agree with Rafter. My question would be why an IVA was affordable but a DMP isn't? Surely you still have that surplus somewhere which you can allocate to the DMP. Of course bankruptcy is an option, especially if you can't pay the debt you have, but I would err on the side of caution.

Conor_3

Just to add, you'll still possibly qualify for Tax Credits, it's just that the Child Tax Credit component will cease.