Helping my brother with his debt problems

luvchocolate

I was allowed £190 for food...a single person and £20 hairdressing

TheGardener

I would suggest some sort of travel budget - how he spends that would be up to him but he could quite reasonable claims something - does he never go anywhere except work?
No - Skye TV in his circumstances is not 'essential'
Agree the food/housekeeping is high
£10 for a haircut per month for a chap might be considered nearer the mark

dancingfairy

Is he making the minimum payments on the debts?
Has he considered making full and final settlements?
Has he looked at the snowball calculator to work out how quickly he can pay off his debts if he knuckles down.
All different things to consider.
df

luvchocolate

are you realize I am female I asked for £25 but had to settle on £20..maybe my username gave my gender away lol
Yes put something in for travel...it can be used for something else

arcon5

An IPA lasts 36 months and will vary with his income. Not sure how he would be worse off repaying an estimate of £7200 instead of £25k

ALIBOBSY

arcon5 wrote: »

An IPA lasts 36 months and will vary with his income. Not sure how he would be worse off repaying an estimate of £7200 instead of £25k

From a monetary POV OK he would pay back less overall, but there are long term implications for getting mortgages and any other lending, at least for 6 years. I also believe it pushes up insurance costs and prevents you from doing certain jobs, in fact some employers put it in your contract and I have heard of someone losing a job due to going bankrupt.

The brother is 33 and its entirely possible he may meet someone he wants to settle down with in the next couple of years and this decision now could effect his future life from that angle.

Its not a case of just walk away from your debts and start again, and shouldn't be taken lightly. Most people on here are at rock bottom and its simply a relief to end that stress. The brother needs to understand the implications and realities. He needs to contact one of the debt charities and talk through the options and implications.

good luck

Ali x

Toffeman

Many thanks to all of you for your advice. It has all been really helpful.

From my perspective I see my brother as wanting to go bankrupt as the first step in trying to change his life for the better.

He spoke to the National Debtline a week ago and he does not want to go down the IVA route after hearing bad things from people he knows who have done the same.

My fears were based around him going bankrupt and being in a worse position then he is now dependent on how much money the OR will leave him with each month. I'm not sure what will happen but least I can try and warn him that it might not be as easy as he may have originally thought.

Once again many thanks.

arcon5

ALIBOBSY wrote: »

From a monetary POV OK he would pay back less overall, but there are long term implications for getting mortgages and any other lending, at least for 6 years. I also believe it pushes up insurance costs and prevents you from doing certain jobs, in fact some employers put it in your contract and I have heard of someone losing a job due to going bankrupt.

The brother is 33 and its entirely possible he may meet someone he wants to settle down with in the next couple of years and this decision now could effect his future life from that angle.

Its not a case of just walk away from your debts and start again, and shouldn't be taken lightly. Most people on here are at rock bottom and its simply a relief to end that stress. The brother needs to understand the implications and realities. He needs to contact one of the debt charities and talk through the options and implications.

Sorry but there is and should be serious implications of going BR - it's a very big step to take and for obvious reasons never should have very low barriers to entry/implications going forward. And I say that as an individual who is bankrupt.

The long term affect (well, this affect will be significantly less after 6 years) of BR isn't really much more in terms of borrowing (mortgage) than the affect of an IVA or loads of defaults for example. A mortgage may be quite far out of reach to a discharged BR - but it's also very far out of reach to an individual paying down £25k of debt through IVAs or other arrangements with creditors.

Since BR pretty much always sees the individual being released from paying significantly sums of money they would have otherwise paid - I see no reasons the BR shouldn't face other obstacles - and certainly don't see why the consequences you mention are unjust.

Let's remember, the fresh start is a mere consequence of BR - BR is merely declaring yourself insolvent (ie unable to pay your bills as they fall due) - the OR then takes control of your estate and their job is to realise any assets you may have for the benefit of the creditor. It's only then the shortfall is basically written off and BR starts again.

I'm not having a go here - but I don't find it tasteful so think or imply in any way or form the mentioned consequences could in anyway be seen as an injustice in life.
And again - I say this as somebody who has himself been through BR.

ALIBOBSY

arcon, not sure why you have quoted me, but I was saying exactly the same as you. BR is a serious step with long term implications and I was pointing this out to the OP. I got the impression that the OP's bro thought BR was an easy way out of his financial mess and I was pointing out its not. I never said or implied that these consequences should or should not exist, they just are I certainly wasn't suggesting the are an "injustice". I was simply pointing out that the bro needs to understand exactly what he is getting into.

Obviously what people mean can come across differently in writing from the original intent, but I have reread what I said and cannot see how you got the idea I was suggesting any kind of "injustice".

You may be commenting on the whole of the thread or have read something in my entry that wasn't there, sorry.

We had our financial issues and considered BR amongst other solutions, but ended up with a self arranged DMP and cutting right back-MSE helped with that, so whatever you decide it has its own advantages and challenges. We had a tough few years but ended up able to buy a house before things went crazy price wise and cleared a 5k overdraft and now work entirely "in the black". Its hard whatever you do.

For the record I agree that to be able to leave so much debt behind it shouldn't be easy and has to have an element of "punishment", I was simply saying the bro needs to know about these knock on effects.

Ali x

arcon5

@alibobsy,

Sorry got my wires crossed. Should have seen you wasn't the op