New and Scared

ottergirl_2

Hi,
I've just gotten off the phone with my trustee for the first time, and I'm majorly stressed.
I'm 47, single, I rent (cheaply from a friend), I'm all of 2 weeks sober (again), I'm doing my best to take responsibility and control of my life.
It's only just become completely crystal clear to me that I'm locked in for 4 years (I live in Scotland), that the bankruptcy being 'discharged' in a year makes no practical difference to me whatsoever. Any income over and above what has been deemed my average (it's variable in the job I'm in, but I pretty well hover around the poverty line) is theirs. For 4 years I won't be able to create any kind of safety net- if my friend sells his house (which he probably will because he now lives in the States and has a green card) I won't have the necessary bond/2months in advance to be able to move. I won't be able to save to move back to Australia, where I grew up, and where my mother now lives alone. I won't be able to yada yada yada......
I've been in my job for over 8 years, I'm burnt out, I need to move on, but where's the incentive to try to better my circumstances if anything extra goes to the banks? (I resent giving them anything, I'd be fine with my money actually going to help others.)
I'm in teary whinging mode right now, and I'm sorry for that, but I'm aware that I need support, I need to find out what this has actually been like for others in practice. I just want to send these words out to others who might actually Get It.
Thanks

Flm67

I'm also in Scotland but I'm 3+ years down the road from where you are. First piece of advice is make sure you allow for everything that you're allowed on your SOA. If you're earnings are low then you might not have anything to pay and this can only be set up within the first year as far as I know.
It's a hard knock to take but you'll soon get your head round it all. Have a look on this forum and you should be able to find what expenses etc are allowed.

ottergirl_2

Thanks,
I went through the CAB to get all this done, my advisor didn't think I'd have to pay anything and sorted the figures so that my outgoings=my income as averaged over the last two years, but because the AIB required my exact last three payslips, which vary substantially, it's been decreed that I can pay back £24.27/month since that was the exact amount my last three months income was over my usual average. Seems random to me but I'm not baulking over that amount, I'm panicking over the fact there's absolutely no point in me working extra hours (which I was hoping I might be able to do- because part of the whole point of going down this route was to deal with the stress of debt, therefore help make me more functional) to make my situation better. As far as I can tell, even if I manage to get my IPO to zero, I'll still have to start paying after that first year if I earn more.
I guess I'll go back to the CAB
And yes, look around here.

downhillfast

ottergirl wrote: »

Hi,
I've just gotten off the phone with my trustee for the first time, and I'm majorly stressed.
I'm 47, single, I rent (cheaply from a friend), I'm all of 2 weeks sober (again), I'm doing my best to take responsibility and control of my life.
It's only just become completely crystal clear to me that I'm locked in for 4 years (I live in Scotland), that the bankruptcy being 'discharged' in a year makes no practical difference to me whatsoever. Any income over and above what has been deemed my average (it's variable in the job I'm in, but I pretty well hover around the poverty line) is theirs. For 4 years I won't be able to create any kind of safety net- if my friend sells his house (which he probably will because he now lives in the States and has a green card) I won't have the necessary bond/2months in advance to be able to move. I won't be able to save to move back to Australia, where I grew up, and where my mother now lives alone. I won't be able to yada yada yada......
I've been in my job for over 8 years, I'm burnt out, I need to move on, but where's the incentive to try to better my circumstances if anything extra goes to the banks? (I resent giving them anything, I'd be fine with my money actually going to help others.)
I'm in teary whinging mode right now, and I'm sorry for that, but I'm aware that I need support, I need to find out what this has actually been like for others in practice. I just want to send these words out to others who might actually Get It.
Thanks

I know this must all still be quite raw we you but you must remember - you ARE in a much better position now than you were. I know you still don't feel safe with not seeing how you can save any money to create a safety net, but had you not gone bankrupt you wouldn't have been able to either as you'd still be paying debts.

I don't know how it works in Scotland but is your payment now set in stone or could it still be negotiated with the trustee? In England, if you get as far as discharge without having to pay an IPA then you are free... and to be honest you are only £25 short regarding legit expenses of not having a payment imposed (again I don't know how it works in Scotland) but I'd be looking to revise my SOA if I were you to try to squeeze that £25 excess out.

downhillfast

Ive just been reading up on this as your situation really struck a chord with me.

Are you sure the trustee said IPO rather than IPA? An IPA is an 'agreement' and has to be agreed by both parties. An IPO is more court enforcable...

Anyway...The more I read about it the more I think it's the same as in England as in that if you can get to discharge without an IPO or IPA in place than it cannot be applied for. The only exception is if you have an IPA and don't pay it they can request to have it changed to an IPO which is enforcable in court.

Below is an extract from Bankruptcy and Diligence etc. (Scotland) Act 2007

Section 18 – Income received by debtor after sequestration

71.This section amends section 32 of the 1985 Act introducing income payment orders (IPOs) and income payment agreements (IPAs). An IPO is an order requiring the debtor to pay to the trustee a proportion of any income the debtor receives after the award of sequestration. The order may require a third party to pay income due to the debtor straight to the trustee instead. It must, subject to one exception (see paragraph 72 below), be applied for by the trustee before the date of the debtor’s discharge. It can run for a maximum period of 3 years and the application must state what period is being applied for. Debtors may be subject to criminal penalties if they default on payments (see new subsection (2ZA) of section 32).

72.An IPA is a formal written agreement between the debtor and the trustee in the same terms as an IPO, but without the requirement of court involvement, and without the possibility of criminal sanctions for defaulting (see new subsection (4F) of section 32). Section 32(4L) of the 1985 Act provides for one exception to the rule that an IPO cannot be applied for after the debtor has been discharged from sequestration. If a debtor has failed to maintain payments agreed under an IPA the trustee can apply to the sheriff to have the remaining payments due converted to an IPO. The application can be made before or after the date of the debtor’s discharge.

I'm no expert with legal jargon but to me it does look like they only get a year to impose it...

National_Debtline

Hi folks


Just so you're all aware, it looks like ottergirl's bankruptcy took place after the changes to Scottish insolvency law which came in on 1 April 2015. This means that references to Income Payment Agreements/Orders (IPAs/IPOs) are out of date, as the trustee now makes a Debtor Contributions Order (DCO) in all "standard" bankruptcies. If two or more payments are missed, the trustee can arrange to take the money directly from the bankrupt's employer.


Ottergirl - if you wish to disagree with the trustee's decision to seek this DCO, you have 14 days from the date of the decision to appeal it.


Ultimately, if you find yourself needing to save for an essential like a rental deposit, this can be negotiated. In some cases you can ask for a payment break of up to six months to help with this.


Dennis
@natdebtline

coolcait

It doesn't sound as if your CAB has helped you here - they seem to be stuck in the old way of doing the I&E.


If you believe that your Debtor Contribution Order (DCO) has been wrongly assessed, then you can ask for a review of it. But you need to be quick - I think you have 14 days to get the review request in.


If your 'extra' money is from overtime, or similar, then that extra should be averaged out across 12 months, not three. You'd need to send in the past 12 months payslips, so do be sure that you're happy with the figures that you're sending in.


You also need to make sure that the expenditure part of your I&E is accurate. The trigger figures are fairly generous, so even if you do have to pay a DCO, it should be possible for you to make economies within the money you're allowed, so that you can gather together savings.


In fact, I believe that the Common Financial Tool, as used in Scotland since April, actually allows some scope for savings.

ottergirl_2

Yes, I initially tried to put in for my average over the last 12 months, my P60 for the past two years was very consistent despite wildly varied monthly income, but after submitting that I was asked to provide just my last 3 payslips.
I was told point blank in my phone interview today that there are no provision for savings, I hope that is wrong. I've made another appointment with CAB to see if I can get a clearer picture, I go cross-eyed looking at this stuff by myself. I've no wish to shirk responsibility for the position I've gotten myself into but it does seem punitive to say to people who've been financially stressed to the point they have to declare Enough! to not allow them any wriggle room.
downhillfast, thanks for reminding me I am still in a better position than I was- years of working and income being swallowed up by minimum card payments, snowballing. Even with a small income, it's still a relief to see what's coming in and out actually making some sense. I'll try to focus on that, and deal with any crises as they arise, and not in my imagination beforehand.
Appreciate everybody responding.
I'll try to educate myself better