Advise needed on relative possibly going bankrupt

Dools_2

Just wondered if anyone could give me any advise.
Basically my sister is in a huge amount of debt (65K) and as she can no longer afford to pay her rent she is coming to live with myself and my husband. She has been to the CAb and they have said that she can either go bankrupt or try and get herself together with a payment plan to her creditors and then in 12 months time go for an IVA.
She is going for the latter option - but to be honest although she has sorted quite a bit out (contacted creditors etc) she still has a huge amount to do and she just does not seem to have the motivation (I don't blame her in some ways as her debts are incrediably over whelming).
I just wanted to know that if she did go bankrupt,then how will it effect myself and my husband (we own our own house etc) particularly if she makes herself bankrupt whilst living at our address.
I can't seem to find any advise for those who have a relative going bankrupt and what the implication maybe for them so thought someone through the forum maybe able to help.

rufus79

I have just gone bk after paying an IVA for a year - not a penny of which actually went to my creditors! As it was me, not mu landlord who went bk, it has had no effect whatsoever on his credit rating. And my Dad going bk over a year ago has had no effect on either mum or my brothers rating. (sadly, its been a bit of a family tradition, not one we are proud of!)

fermi

It shouldn't effect you or your husband at all.

* Credit Reference Files/Records are based upon the individual and not the address.
* If she has no interest in the property that will be unaffected.
* In bankruptcy no-one calls round to inspect/take goods without an exceptional cause.

It's all remarkably civilised really, and won't cause you any trouble.

backontheup

I would steer her away from and IVA and get her to think about BR. Even with an IVA it is still a huge debt and the IVA is likely to fail. But of course, that is just my view. She needs to get some advice from national debtline or CAB

Dools_2

Thank you so much for the responses - it has put my mind at rest. I know she has been in touch with the National Debt Helpline and has had some great advise.

debt_doctor

Hi, why is she going for an IVA when there is no property to protect ?? Unless there is another reason perhaps the job she is in, or is a charity trustee or company director then an IVA will be far more costly and take longer to pay off.
I would say that unless there is a good reason to have an IVA then give them a very wide birth.

Best

DD

malestrom07

Hi there
I strongly advise you to get her to contact one of the free debt advice services. They will weigh up all her options and give good honest advice. Don't forget that IVA's incur fees, that not all creditors accept them and that it's 60 month legally binding agreement that may well result in bankruptcy if it fails or payments are missed, so the money could be wasted anyway.

CCCS have a specialist bankruptcy support unit, so they can definately help her. Their number is in the Yellow Pages Under Useful Numbers/Helplines

fermi

malestrom07 wrote: »

Their number is in the Yellow Pages Under Useful Numbers/Helplines

Or in my signature.