bankrupcy threat

john1965_2

Hi looking for some advice i have several debt most i am paying at areduced and thecrediters are fine with this. I have 1 debt though with a company called lowells or red. With these i owe £840 they keep sending me letters saying they recommend to there clients to take proceeding agaist me for recoverery of debt. They also say i could be made bankrupt for the above amount if i was over the bankrupcy threshold. ( what is the threshold) is this true thanks for any help given john

Squirrel29

Hi, I am not an expert in this but I seem to think you can be made bankrupt by a creditor for a debt over £750.

Take care, Squirrel xx

fermi

Technically they are correct. The lower limit for a creditors petition is £750.

But the chances of them actually doing this for such a small amount are minuscule.

It will cost them a minimum of £590 in fees (thanks rog2) with no guarantee they would ever get their money back.

99.9% of the time these sorts of letters are purely scare tactics.

It would really really be worth reading this thread on the bankruptcy board entitled "Threat of Bankrupty Proceedings":

Link: http://forums.moneysavingexpert.com/showthread.html?t=540081

rog2

Agree with both squirrell and fermi - you are MOST UNLIKELY to be declared bankrupt for a debt of £840.00.
Lowell and Red are well known for this type of scare tactic - I would just keep paying the reduced payments. In the unlikely event that they do decide to pursue this debt through the courts, their most likely course of action would be to attempt to obtain a County Court Judgement against you, for which they would have to issue you with a court summons, at which time you will be able to submit a defence to the court. A court would see that you have been making a reduced but regular payment, and by virtue of this would see that you are treating your debts seriously. The court MAY issue an order to continue paying, but would NOT ask you to pay any more than you can afford - this COULD mean that the Court orders you to pay LESS than you are currently paying. Any resultant Court Order would be just as binding to the dca as it would be to you and they would not be allowed to harrass you for higher payments. The Court could, also, find against the dca for costs.
So even this option is not very inticing to the dca.

john1965_2

thanks for the piece of mind guys most helpfull

john1965_2

1 more question so if i brought the debt down to under £750 with a payment that would remove that option for them anyway

Squirrel29

Hi, yes it would.. just don't default to other creditors to achieve this!:rolleyes:

fermi

john1965 wrote: »

1 more question so if i brought the debt down to under £750 with a payment that would remove that option for them anyway

It would, but I would be careful how you do this.

Once a DCA like this sees that you have made a one off payment above what you are routinely paying them and other creditors/DCA's it's like a shark smelling blood in the water.

As far as they are concerned it undermines your stance that you are only paying what you can afford (rightly or wrongly).