Planning BR

skint98

Hi after a long time following this forum the time is approaching for my husband and I to apply for bankruptcy. We voluntarily surrendered our house in Dec'13 after falling behind with payments when my husband lost his job and are waiting on it being sold by NRAM to find out what the shortfall will be. We are estimating it to be between £50-£60k. We also have another approx. £4300 unsecured debts. We are using our local CAB to help us with the process. We haven't been in touch with them for a while so was wondering if anyone on here could answer a few questions. We live in Scotland (I know some of the processes etc are different).
1. I have a car on HP which I am up to date with payments on (£91 per month) which I need for work. Is there a chance I will be able to continue this? I have 2 years and 5 months left in the agreement.
2. We have moved into a private let. I have noticed a clause in the lease stating we can be evicted if we become bankrupt or enter an IVA. We're worried as we have only been tenants for 2 months. Is there a high chance we will be evicted?
3. Could someone post the link to where I can complete our SOA for people to look at to give feedback and an idea of how much our IPA could be.

Thanks in advance.

skint98

I managed to find the link for the statement of affairs which I have completed and attached below. Any feedback would be greatly appreciated.
Thanks


Statement of Affairs and Personal Balance Sheet
Household Information
Number of adults in household........... 2
Number of children in household......... 3
Number of cars owned.................... 1

Monthly Income Details
Monthly income after tax................ 1164
Partners monthly income after tax....... 650
Benefits................................ 535 (Child tax credit)
Other income............................ 203 (Child benefit)
Total monthly income.................... 2552

Monthly Expense Details
Mortgage................................ 0
Secured/HP loan repayments.............. 91
Rent.................................... 600
Management charge (leasehold property).. 0
Council tax............................. 157
Electricity............................. 67
Gas..................................... 90
Oil..................................... 0
Water rates............................. 0
Telephone (land line)................... 15
Mobile phone............................ 52 (2 contracts)
TV Licence.............................. 12
Satellite/Cable TV...................... 24
Internet Services....................... 5
Groceries etc. ......................... 530
Clothing................................ 60
Petrol/diesel........................... 150
Road tax................................ 21
Car Insurance........................... 47
Car maintenance (including MOT)......... 40
Car parking............................. 0
Other travel............................ 80 (Public transport for husband)
Childcare/nursery....................... 42
Other child related expenses............ 50
Medical (prescriptions, dentist etc).... 28
Pet insurance/vet bills................. 13
Buildings insurance..................... 0
Contents insurance...................... 15
Life assurance ......................... 45
Other insurance......................... 0
Presents (birthday, christmas etc)...... 30
Haircuts................................ 30
Entertainment........................... 50
Holiday................................. 40
Emergency fund.......................... 50
professional body and union fees... 30
Total monthly expenses.................. 2464

Assets
Cash.................................... 0
House value (Gross)..................... 0
Shares and bonds........................ 0
Car(s).................................. 0
Other assets............................ 0
Total Assets............................ 0

Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 0........(0)........0
Hire Purchase (HP) debt ...... 2639.....(91).......0
Total secured & HP debts...... 2639......-.........-

Unsecured Debts
Description....................Debt......Monthly...APR
estimated shortfall from house...........55000.....0.........0
bank loan......................3100......1.........0
catalogue......................900.......1.........0
overdraft......................350.......1.........0
Total unsecured debts..........59350.....3.........-


Monthly Budget Summary
Total monthly income.................... 2,552
Expenses (including HP & secured debts). 2,464
Available for debt repayments........... 88
Monthly UNsecured debt repayments....... 3
Amount left after debt repayments....... 85

Personal Balance Sheet Summary
Total assets (things you own)........... 0
Total HP & Secured debt................. -2,639
Total Unsecured debt.................... -59,350
Net Assets.............................. -61,989

National_Debtline

Hello there,

Here are some answers for you.

1. I have a car on HP which I am up to date with payments on (£91 per month) which I need for work. Is there a chance I will be able to continue this? I have 2 years and 5 months left in the agreement.

The Trustee in Bankruptcy may allow you to keep the vehicle - especially if you need it for work. It is absolutely down to their discretion. What's on your side is that the instalment is relatively low. Whilst I cannot tell you want the outcome is for sure, I think you have a good chance in arguing your corner.

2. We have moved into a private let. I have noticed a clause in the lease stating we can be evicted if we become bankrupt or enter an IVA. We're worried as we have only been tenants for 2 months. Is there a high chance we will be evicted?

It is often the case that these clauses are present to allow a landlord to quickly evict a tenant that has rent arrears who become insolvent. On the face of it, a landlord is likely to be happy to have you stay in the property so long as they're getting their rent. It is absolutely vital that you speal to the landlord to ensure that they are happy for you to stay before you petition.

3. Could someone post the link to where I can complete our SOA for people to look at to give feedback and an idea of how much our IPA could be.

I've had a quick look at the figures, they all look OK to me. The Trustee may flag up the holiday/entertainment/emergency figures although I appreciate that you are a family of five.

Best wishes,

David @ NDL.

alastairq

Quote:
<<<1. I have a car on HP which I am up to date with payments on (£91 per month) which I need for work. Is there a chance I will be able to continue this? I have 2 years and 5 months left in the agreement.>>>

The Trustee in Bankruptcy may allow you to keep the vehicle - especially if you need it for work. It is absolutely down to their discretion. What's on your side is that the instalment is relatively low. Whilst I cannot tell you want the outcome is for sure, I think you have a good chance in arguing your corner.

Since the car is on HP it isn't the OP's asset, so the HP company needs to be consulted as to whether they themselves are prepared to continue after BR?

tigerfeet2006

skint98 wrote: »

I managed to find the link for the statement of affairs which I have completed and attached below. Any feedback would be greatly appreciated.
Thanks


Statement of Affairs and Personal Balance Sheet
Household Information
Number of adults in household........... 2
Number of children in household......... 3
Number of cars owned.................... 1

Monthly Income Details
Monthly income after tax................ 1164
Partners monthly income after tax....... 650
Benefits................................ 535 (Child tax credit)
Other income............................ 203 (Child benefit)
Total monthly income.................... 2552

Monthly Expense Details
Mortgage................................ 0
Secured/HP loan repayments.............. 91
Rent.................................... 600
Management charge (leasehold property).. 0
Council tax............................. 157
Electricity............................. 67
Gas..................................... 90
Oil..................................... 0
Water rates............................. 0
Telephone (land line)................... 15
Mobile phone............................ 52 (2 contracts)
TV Licence.............................. 12
Satellite/Cable TV...................... 24
Internet Services....................... 5
Groceries etc. ......................... 530
Clothing................................ 60 I WOULD UP THIS TO AT LEAST £100
Petrol/diesel........................... 150
Road tax................................ 21
Car Insurance........................... 47
Car maintenance (including MOT)......... 40
Car parking............................. 0
Other travel............................ 80 (Public transport for husband)
Childcare/nursery....................... 42
Other child related expenses............ 50 WHAT IS THE BREAK DOWN ON THIS.
Medical (prescriptions, dentist etc).... 28
Pet insurance/vet bills................. 13 IS THIS JUST YOUR INSURANCE OR DOES THIS INCLUDE SOME FOR THE EXCESS AND THINGS NOT COVERED. £20
Buildings insurance..................... 0
Contents insurance...................... 15
Life assurance ......................... 45 OR MAY HAVE AN INTEREST IN THIS
Other insurance......................... 0
Presents (birthday, christmas etc)...... 30 USUALLY NOT ALLOWED
Haircuts................................ 30 £35
Entertainment........................... 50 USUALLY NOT ALLOWED
Holiday................................. 40 £80/100
Emergency fund.......................... 50
professional body and union fees... 30
Total monthly expenses.................. 2464

Assets
Cash.................................... 0
House value (Gross)..................... 0
Shares and bonds........................ 0
Car(s).................................. 0
Other assets............................ 0
Total Assets............................ 0

Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 0........(0)........0
Hire Purchase (HP) debt ...... 2639.....(91).......0
Total secured & HP debts...... 2639......-.........-

Unsecured Debts
Description....................Debt......Monthly...APR
estimated shortfall from house...........55000.....0.........0
bank loan......................3100......1.........0
catalogue......................900.......1.........0
overdraft......................350.......1.........0
Total unsecured debts..........59350.....3.........-


Monthly Budget Summary
Total monthly income.................... 2,552
Expenses (including HP & secured debts). 2,464
Available for debt repayments........... 88
Monthly UNsecured debt repayments....... 3
Amount left after debt repayments....... 85

Personal Balance Sheet Summary
Total assets (things you own)........... 0
Total HP & Secured debt................. -2,639
Total Unsecured debt.................... -59,350
Net Assets.............................. -61,989

As Alistair has said, check with the HP company as to whether they are happy for you to continue when BR, most will terminate the contract.


How old are the children?

skint98

Thanks for the replies. Should I be contacting the HP company before applying for bankruptcy or would the OR do that? If they take the car back would I be allowed to buy a cheap run around? I could possibly save a few hundred for this before applying for BR as we are planning on waiting until the house is sold and we know the shortfall.

My kids are aged 7, 4 and 18mths. On the SOA the child related expenses of £50 are for brownies, football, snack money paid to nursery, and mother toddler groups. Would this be allowed? The pet money is insurance and flee and worming treatment. Pet food is included in groceries. My life assurance is high as it was set up to cover the mortgage so obviously we won't be needing such a high cover anymore . Just not sure what to do about it now but don't want to cancel it.

longtermplanner

alastairq wrote: »

Since the car is on HP it isn't the OP's asset, so the HP company needs to be consulted as to whether they themselves are prepared to continue after BR?

It would be a rare HP company that is not happy for the contract to continue. Depreciation hits most in the first few months, so after that a HP company would usually prefer to continue to receive the HP payments rather than repossess the car, which is their only alternative remedy in bankruptcy.

I don't think you have to worry about this one.

sort_me_own_yard_out

I agree with Tiger feet....The OR upped my clothing to £30 per person per month so I would be tempted to put £150 down. Your children are t an age where they grow fast and that can be eaten up pretty fast when it comes to school shoes and unform etc

Good Luck

tigerfeet2006

Longtermplanner, I'm sorry but experience on this board and in real life points to 9 times out of 10 the HP company not continuing with the agreement.

Skint, if I were you I would ring and make a general enquiry, say you are weighing up your options and want to know their procedure if you enter into a DMP, IVA, BR. What are they likely to do? If they say they would cancel the agreement then stop paying them and put the money by to buy a car before your BR. It will usually take them a couple of missed payments to twig and go through procedures to repo the car so you could potentially have £600 or so to by a runaround.

Definitely up the clothes amount to £120/150

Put £5 per child per week down for activities. Put £2.50 per day for the two at school for school dinners. This would go down in the child related expenses.

You need to look at the rules for BRs and life insurance or the OR may benefit years later.

macbabypam

We had 2 cars when we went BR. One was on a personal lease plan and one on HP. The personal lease terminated as they sais there was a clause against BR in the contract.

The HP car company said it was no problem as we had never defaulted, they were happy to continue as long as payments were made on time.

Therefore I would suggest you ring them as they seem to vary a lot.

Good luck

skint98

Thanks everyone for all the great advice. Will call the HP company on Monday and find out what their policy is. Will definitely put up the clothing costs on the SOA.