creditors bankruptcy petition

Panic1972

I don't know where to start. I am roughly 44k in debt to credit card companies and loans to my old bank who i still have my mortgage with and a loan to tesco bank.

i have set up a payment plan through stepchange and are paying a monthly fee to all the creditors that has been running for the last 4 months however 1st credit who i owe 15k to have whilst this has been going on put something called a b10 notice of registration on my property and last night i had a man at the door with a creditors bankruptcy petition and he said i have to go to court on the 28th of august.

i am absolutely bricking it the wife and kids been up all night crying i have rang stepchange today and they have said i need to call 1st credit if i don't want to go bankrupt and see if i can come to a separate arrangement with them to stop them proceeding with the bankruptcy and possibly put a charge order on the property?

I really do feel like im up the creek without a paddle keep getting told different things by people i know like let them make me bankrupt they wont make me sell the house as i have 3 kids but stepchange said they would if there is equity in it which i roughly think is about 15k.

can anyone tell me what i need to do next as i have not got a clue?

debt_doctor

Hi,

Is the property jointly owned?

It is true to say that the house could be sold in bankruptcy to realise any equity (only your equity, not a joint owners). However, you have 'home rights for a year, so house could not be sold for a year.
Currently if the bankrupts share of equity is less than £10k then a sale doesnt happen - a charging order is placed upon the property instead. However, the trustee has up to 3 years to deal with the property.
Someone you know could pay the trustee the money covering your equity to avaoid a house sale.

Fact is, with the equity you suggest (or even up to £30 - 40k) 1st credit would not receive any money from making you bankrupt - it would all go to case management fees, secretrary of state fees and the good old greedy Insolvency Practitioner.

Presuming that you owe the money (it's not time barred or anything?) then perhaps best course of action may be to offer a voluntary charge - it would certainly be in 1st credits best interests! - you would need to stipulate no order for sale though.

Next step is to write to 1st credit pointing out that they will receive nothing from making you bankrupt.
DD

National_Debtline

Hi

I agree with debt doctor that making you bankrupt isn’t a good idea from 1st Credit’s perspective at all, and offering a payment plan plus a voluntary charge on the property may persuade them not to proceed.

James
@natdebtline

Panic1972

Thank you

There is only my name on the mortgage we could not borrow no where near enough from the bank if my wifes name was on it so i had to do it on my own.

I have contacted the solicitor today who have informed me that although 1st credit have been receiving payment each month stepchange have never had an agreement for this amount from them. I have been told by lester aldridge solicitors to get step change to send the offer along with my expenditure to them and they will see if first credit will agree to a payment plan.

i have called 1st credit who say its out of their hands

i have called step change who say that they do not pay money to companies unless an agreement has been made and they advised me to get legal help to deal with the court hearing and turns out i do not qualify for legal aid

i guess all i can do now is wait until next week which will hopefully give step change enough time to send the offer to the solicitor and then see if they plan on still taking it to court.

Feel a bit better that you guys have taken the time to reply and i really thank you for that but i still feel like my world is tumbling down and there is no way to stop it

dancingfairy

I'm a little confused. In part of your post you say the solicitors say 1st Credit have been receiving payment each month yet then you go on to say Stepchange won't pay creditors unless an agreement is reached.
Have Stepchange been paying 1st credit? Has stepchange written to 1st credit formally offering your payment plan (as opposed to possibly just paying them randomly)?
Personally I'd not trust Stepchange to deal with this at this stage. I'd want to write a letter myself, stating something along the lines of further to your communication from Stepchange (copy enclosed) I am writing to reiterate my committment to paying this debt off, however at this point I can only afford x per month (please see attached budget).
I have received a section whatever notice which impies your intention to make me bankrupt. I'd like to point out that there is minimal equity in my property, certainly there will be little left for you once trustees fees have been taken out.
I'd like to propose a payment plan of x per month (as outlined above) and would be willing to offer you a charge over the property as surety, in return for this I ask that you cancel the bankruptcy notice.
I notice that you are signed up to the FSAs code of conduct/on your website it states that you are bound to treat customers fairly and I would urge you to strongly consider my payment plan.
I have sent a copy of this letter to Stepchange and also to your solicitors.
Yours

dancingfairy

I'd also like to state that IF they made you bankrupt and IF there was deemed to be sufficient equity in your house then you would not be physically homeless.
The council would not let a family with 3 children be put on the streets. You would, in effect be considered 'homeless' by the council and would be given accomodation, possibly temporary at first (assuming that you are not at fault in anyway ie have been deliberately not paying your mortgage or something) but the council would have a duty to house you.
Your situation isn't ideal but certainly nowhere near as bad as you are fearing.
I suggest you read up on the process of bankruptcy so that you are prepared IF this does happen. It should allay a lot of yours and your wifes (And your children's fears).
df
edit: at the end of the day it is a pile of bricks, what matters most is family, good health etc and wherever you end up you can make a home.

Panic1972

"I'm a little confused. In part of your post you say the solicitors say 1st Credit have been receiving payment each month yet then you go on to say Stepchange won't pay creditors unless an agreement is reached."

No step change are saying that they have made and agreement with the halifax but this should of been made to first credit the halifax have been getting the money each month and giving it to 1st credit so i have been informed.

I will right a letter like you say to The solicitors thankyou i would not know how to structure a letter like that but you have gave me a good foundation to use.

Many thanks

Former_StepChange_Laura

Panic1972 wrote: »

I don't know where to start. I am roughly 44k in debt to credit card companies and loans to my old bank who i still have my mortgage with and a loan to tesco bank.

i have set up a payment plan through stepchange and are paying a monthly fee to all the creditors that has been running for the last 4 months however 1st credit who i owe 15k to have whilst this has been going on put something called a b10 notice of registration on my property and last night i had a man at the door with a creditors bankruptcy petition and he said i have to go to court on the 28th of august.

i am absolutely bricking it the wife and kids been up all night crying i have rang stepchange today and they have said i need to call 1st credit if i don't want to go bankrupt and see if i can come to a separate arrangement with them to stop them proceeding with the bankruptcy and possibly put a charge order on the property?

I really do feel like im up the creek without a paddle keep getting told different things by people i know like let them make me bankrupt they wont make me sell the house as i have 3 kids but stepchange said they would if there is equity in it which i roughly think is about 15k.

can anyone tell me what i need to do next as i have not got a clue?

Hi there Panic1972,

I’m sorry to hear about your situation and I hope you don’t mind me joining the conversation on this thread. From your messages it sounds as though there’s some confusion and a couple of issues with communication which I’d like to resolve.

You mention that you’ll be getting in touch with us this week, but if you would like to DM me with your client reference number, email address, and a bit more detail about what has gone on, we can look into this for you.

Kind regards,

Laura