Car on HP & Bankrupcy

seth0571

Hi There,

really hope someone can help us. Our family business is going into volutary liquidation so we have no source of income forcing us to go personally bankrupt (we have personal guarantees against the company.)

We have a car from Ford credit which we took out on HP in Oct 2012 we have paid less than half of the repayments & were going to give this back asap (we are awaiting to move towards the bankrupcy after liquidation). We have found out that hire purchase is not covered in the bankrupcy order & have worked out that with the cost of returning this the finance company will expect around 11k for outstanding payments, extra mileage etc. We took out the HP when our company was booming but we have had a really bad season & cash forecasting has made us close.

At the moment we are terrified about losing the business & our incomes, our latest nightmare is this. Please can anyone tell me how can you pay back this if you are made bankrupt? We would be extremely grateful for any help or advice

tigerfeet2006

Who told you it wasn't included in the BR? Of course it can. The car goes back, the debt becomes unsecured and goes into the BR.

wharty

I think the reason the car can't be included in the Bankruptcy is because it's not your asset. Once you return it to the finance company the shortfall becomes an unsecured debt which in turn is included in your bankruptcy.

I have no idea why i repeated Tigerfeet! sorry.

GazHatesBanks

The only caveat to the above is do not sign any paperwork the finance company send you AFTER bankruptcy as it will almost certainly include a clause holding you responsible for the shortfall.

Stop paying and let them repossess the long way if they won't play ball!