First time considering bankruptcy

crazycatlady73

Hi.
I am speaking to a debt advisor today and considering going bankrupt. It all started last June, I was 35 weeks pregnant and I came home and found my boyfriend dead in our house. He'd had respiratory failure :-( Of course with us not being married yet I had no access to any kind of widows benefit or funeral assistance. My boyfriend didn't have life insurance or a pension.

I returned to work but child care costs are wiping out most of my salary. In addition I have to raise our son alone without financial assistance from anyone, all the house hold expenses are now 100% mine and of course I have credit cards, car finance and a loan which at the time I could afford. As the year is progressing I am robbing Peter to pay Paul so to speak and now Peter, Paul and all the other apostles want their money with interest!

I tried to hand my car back to the finance company and explained the situation but they were not interested in taking it!! MBNA are being absolute !!!!!!s and I don't want to stop workingsimply to cut childcare costs because being unemployed makes my life worse!

So I am considering bankruptcy! I have done some research and looked into the pros and cons.

1. I don't own my house I rent and my landlord is actually a friend so I won't lose my home.
2. I have nothing in my home which is worth more than £500 and it's fully furnished property anyway.
3. My savings are depleted and I have no other assets.
4. Bankruptcy will not effect my professional registration.
5. I know I'll lose my nationwide flex account but I have already checked out the basic bank account with co-op or Barclays. .. will probably go with Co-Op so I can access online banking.
6. I can live without credit cards and on a basic allowance as long as I can put food on the table and keep the roof over our head's.
7. I will have access to a car because I can borrow one off a friend.

The only thing I am concerned about is that my son has a cash junior ISA with Nationwide. At his dad's funeral (he was only 3 days old) people donated money to him and he got quite a bit. It was for him so on principle I didn't use it for me I put it in an ISA in his name. It is locked down until he is 18 and no one can take anything out before that. Will he lose that? Will the OR make me hand my Son's money over? Will I have to ask someone else to look after his finances if I am bankrupt?

National_Debtline

Hi crazycatlady


I'm very sorry to hear about what you've gone through over the past year. I imagine that bankruptcy might seem pretty trivial in comparison.


To address your specific concern about your son's savings, they would not be treated as an asset in your bankruptcy. You may be asked by the Official Receiver to account for the money but as long as they are satisfied that the donations were intended for him, I see no issues.


Bankruptcy can restrict you from exercising certain positions of financial authority e.g. accountancy roles, treasurer positions, charity trusteeships etc. However this wouldn't extend to your normal parental duties which include looking after that ISA.


I'm sure you've done plenty of research but I'd still recommend that you speak to one or more of the free debt charities before taking the plunge. Many courts will expect you to have done this before accepting a bankruptcy petition.


All the best,


Dennis
@natdebtline

Pobby

Hello. Just to say I am very sorry for your loss. The advice given looks to be very sound. Just hoping that you will get some peace shortly. Sounds like your boy has a lovely Mom.

TheGardener

Although BR will not take your sons asset - beware of the bank closing the account. I had this problem because I was the adult named on the account the bank wrote an asked me to move the money so they could close it. I got my dad to open an account to transfer the money into.

standalone

All good advice, the only thing I would add is if you are talking to a debt advisor do not consider at any stage entering in to an IVA, waste of time and money for 5 years.
Best of luck.

crazycatlady73

Thanks everyone. I got my information and I have done my income and outgoing sheet including what I could give to each creditor (peanuts is the word) Anyway I know Nation wide will cancel my account. The debt advice lady said to open an account the day after going BR, but obviously I am concerned about my regular payments not going out in time. Did anyone open a BR friendly bank account before going BR? I was thinking about going with Co-Op.

tigerfeet2006

You can open a Co-op Cashminder account (don't tell them you are going BR) and a Barclays Cash account before BR and get all your DD's etc sorted so you don't have to worry about payments etc.

luvchocolate

good advice as always from tigerfeet...I opened 2 co op cashminder accounts before b.r got all direct debits,wages etc going in and out..then I closed my account with h.s.b.c before they did.

I keep on of them for any "spare" money....and the online banking is great.

3 yrs since my b.r and will keep these accounts as they do everything I need.