Do I... don't I?

longtermplanner

I was going to say that it looks like a straightforward case for bankruptcy, but your brother's inheritance changes the picture. I think you should put the bankruptcy idea on hold for 6 months or a year or so until he has inherited and the reality of his situation sinks in.

In the meanwhile, set up a Debt Management Plan, either by yourself (see http://nedcab.cabmoney.org.uk/dmp.asp and http://debtcamel.co.uk/debt-options/dmp/ about how to do this) or by going to StepChange (http://www.stepchange.org/)

re your expenses. Yes the food lines are too high. But your clothes line is too low and I suspect you are underestimating the car maintenance costs. Also there is no charge for a lease car, but perhaps this is coming out of your wife's income before you included it?

tigerfeet2006

Get in touch with Business Debtline, there was a link posted earlier.

Your brother will be responsible for any debts the business incurred if you go BR. He will not be responsible for any personal debts, even if they were incurred by paying for the business. If your wife paid for any business debts then they are solely her responsibility and not yours or your brother, so would not be included in your BR.

If any of the personal accounts were joint that you paid business expenses on then she would be solely responsible for them in full when you go BR.

Please do ring Business Debtline.

AKOOLA

I'm very touched by everyone's responses. There has been some very sound advice and for that I thank you all. I will be in touch with a charity debt line tomorrow.

As I said right at the start, I would prefer not to go bankrupt. I have no issues paying my way, I just feel it's a bit unfair to have to pay the way for someone else. As for building bridges with my brother... never say never, but at this moment in time I have no wish to see him again unless it's in court.

And now for a piece of wisdom from me. If you're considering going into business with family... don't!

dancingfairy

You don't HAVE to go bankrupt but you COULD go bankrupt if you choose. Whilst it probably doesn't feel like it right now you do have options:
1) a debt management plan (dmp)
2) an IVA
3) bankruptcy.

Any of these might be suitable for you and should be explored. Also, it's possible that if you did a dmp for a few years you might then be in a position work wise to save up for full and final settlement offers.
I think it's a case of working out the pros and cons of each option, the length of time they will take (roughly) and how you feel as a family. Obviously you can do a dmp or IVA and then switch and go bankrupt if they don't work for you so it isn't set in stone but then you have effectively wasted a few years when you probably could have gone bankrupt and be done and dusted.
I'm sure you'll get loads of help and support whatever option you choose.
Best of Luck
df

AKOOLA

If I did choose bankruptcy, can I still chase my brother for the £5000 he owes me?

slickric1234

the creditors could go after the 5k your brother owes you assuming they are owed over that

you could chase and get it, but if you did the creditors would expect to get it so better to hand it to them and get them to chase

are the total debts of the business 26k?
do you personally have any other debts loans etc?

of your current 2236 monthly joint income whats the split between your income and your wifes

if your personal income is relatively low then your future repayments after bankruptcy may be very low

if you do go bankrupt and your wife is no part of the business any loans made by her to the business are likely to be right at the back of the creditors list

id talk to brother and make him aware that your going to have to go bankrupt which may well make him bankrupt too
regardless of whats happened in this business venture hes still your brother, who i assume you were on good terms with prior to it starting otherwise why go in to business with him in first place

if total debts are only 26k id try to exhaust all other options before going bankrupt

if you were in massive negative equity on a mortgage on a house and owed crazy amounts on credit cards and loans that you could never realistically pay then BR would be a way to dig yourself ot of a hole

but for 13k each to avoid the negatives of bankruptcy id certainly do anything i could to avoid it