Bankrupty and benefits

LoveLifeAgain

I may be forced into bankruptcy at some point this year but need to know if they will be able to take anything/everything from the following.


State Pension (earnings related, worked all my life)
Pension Credit
Housing benefit


I lived in my council flat for over 20 years and my rent (I still pay some) and utilities have always been up to date. It is just one solicitor over a civil case I lost in court and ordered to pay the costs. I cannot pay them the extortionate amount they insist on. They told me that I would lose my council flat because I would lose my housing benefit as they would be able to claim all of that including my pension credit and most of my pension and I would not have anywhere to live but they would still be able to claim money from my pension after eviction. They said if I was made bankrupt the council would stop housing me.


I do not have any other money coming in. As a cancer survivor and elderly I feel in a real state. They have done nothing yet but I am preparing myself because the money is not there. I cannot go anywhere for advice as they have only given my part of what I owe and the rest is to follow.

lilybankrupt

My understanding is that benefit income cannot be taken in bankruptcy. I'm also pretty sure the council eviction threat is a load of rubbish.

I would go along to your local Citizen's Advice Bureau or phone StepChange or National Debtline for more definite advice, hopefully to put your mind at rest

fedupfreddie

I was living in a council house and receiving housing benefit and unemployment benefit when I went bankrupt.
They are trying to scare you into paying up, benefits are not even considered except to prove that you are on a low income.
You will not lose your home or housing benefit, pension or pension credit.
You have nothing to worry about.

charybdis1 wrote: »

I may be forced into bankruptcy at some point this year but need to know if they will be able to take anything/everything from the following.


State Pension (earnings related, worked all my life)
Pension Credit
Housing benefit


I lived in my council flat for over 20 years and my rent (I still pay some) and utilities have always been up to date. It is just one solicitor over a civil case I lost in court and ordered to pay the costs. I cannot pay them the extortionate amount they insist on. They told me that I would lose my council flat because I would lose my housing benefit as they would be able to claim all of that including my pension credit and most of my pension and I would not have anywhere to live but they would still be able to claim money from my pension after eviction. They said if I was made bankrupt the council would stop housing me.


I do not have any other money coming in. As a cancer survivor and elderly I feel in a real state. They have done nothing yet but I am preparing myself because the money is not there. I cannot go anywhere for advice as they have only given my part of what I owe and the rest is to follow.

National_Debtline

Hi charybdis1


Yes this does sound like scaremongering on the solicitor's part, to be honest.


The following is an excerpt from the Insolvency Technical Manual, which hopefully makes it very clear that a person living solely on benefits will not be the subject of any income payments in bankruptcy. Please note - the abbreviations IPA/IPO refer to Income Payments Agreement/Order respectively.


31.7.40 IPA or IPO should not be sought where bankrupt’s sole income comprises state benefits
(Amended March 2014)
An IPA or IPO should not be sought where the bankrupt's only source of income is state benefits. In the context of this chapter "state benefits” refers to all forms of income supplement and support provided by central or local government including, but not limited to: income support, job seekers allowance, disability living allowances, incapacity benefit, industrial injuries disablement, council tax benefit, housing benefit, state retirement benefit (state pension), child benefit and all forms of tax credit (child, working and pension). Payments of a War Disability Pension (Naval, Military and Air Forces Etc. (Disablement and Death) Service Pensions Order 2006), the bankrupt having been injured on active service, should be regarded as a state benefit. There is no requirement to undertake an assessment of real disposable income where the only source of the bankrupt's income is state benefits. In all other cases an assessment should be made even if part of the household income is derived from state benefits.


Dennis
@natdebtline

LoveLifeAgain

Oh wow, thank you. I was thinking I would be left homeless. They told me fedupfreddie that the council would evict me, it will be a while before I can overcome the fear they have put into me but thank you everyone.

debt_doctor

Hi,


Yes I agree that what the solicitor says is none sense (a complaint would be appropriate, but you may not want to).
How much do you owe?
DD

merlin68

We went bankrupt on benefits living in a council house. I told the council and they said it doesnt affect your tenancy. They also didnt make us pay anything out of our benefits either so dont worry.