Got worried due to debts

fatbelly

Bankruptcy is not the difficult option you think it is. Actually the others are unrealistic, looking at your SoA.

Nothing on your expenses (including food for 2 adults & 3 children) is excessive. In fact I'd like to see you having some basic contents cover, something for dental bills and something for a basic holiday once a year. I think the official receiver would assess you as having surplus income less than £20 per month and therefore no income payments order.

Get your car valued on Parker's and if (private poor is OK) if it shows as less than £1000, you stand a good chance of keeping it.

As a sole trader your self employment should not be affected.

The application process is all online and the fees can be paid by a credit or debit card.

As for the debts yes, skip payments now and get defaulted. You will need to build up a fund of £680 unless someone else can cover the fees and it looks like that will take time. Make sure you are not banking with an institution where you have debts.

Hopefully none of the debts are joint with your partner. In your situation, if you want independent advice, I'd try Business Debtline. They're good.

john3105

thanks for your all help, was scared to be bankrupt, but all your suggestions show that i go for that, is it ok if i skip two months minimum payments before i go bankrupt to start saving money to pay fees for bankruptcy or should i borrow money from family to start application from next week.
plus in bankruptcy all my bank accounts will be closed. I got halifax account with no loan or overdraft, will they close also.
then how i can manage, should i open basic account before going bankrupt or halifax current account will remain active, so i can use as personal and business use. if not, please someone can tell me what options are available for basic accounts, which banks are good for this purpose.

Hoogle

I hate to say it but Bankrupt is your best way forward and quickest recovery.
It is down to the bank if they close your current account or not but assume they will.

I applaud trying to pay it back but the reality is yes you get defaulted now stays on record for 6 years but debt will still be looming over you causing more stress. and if you manage to pay back token payments for 2 years then default again again etc it can be a never ending loop. Where as get the debts cleared after being declared Bankrupt, after the fees etc then you get a fresh start all money coming in goes to you and your family not debt, realistically 48k will take almost as many years to pay off unless you can make a lot more money, And Benefits can change at any time.

To be fair I am learning about money and debt as I discovered my credit was terrible at the age of 35, I have never had credit/debt or credit cards so started looking around this part of the forum for credit building advise. 2 Months ago i would of thought low of you for building up debt then declaring Bankrupt just seems so irresponsible to me, However after reading peoples problems and diaries etc and how it effects people down the line especially the children then you would be a person I would whole kindheartedly suggesting it is the best option for you. Sure the 1st year is hard but then it gets better and in 6-7 years you will have same credit file as me a clean slate to try again, just learn from this time and try not to do it again.

sourcrates

john3105 wrote: »

thanks for your all help, was scared to be bankrupt, but all your suggestions show that i go for that, is it ok if i skip two months minimum payments before i go bankrupt to start saving money to pay fees for bankruptcy or should i borrow money from family to start application from next week.
plus in bankruptcy all my bank accounts will be closed. I got halifax account with no loan or overdraft, will they close also.
then how i can manage, should i open basic account before going bankrupt or halifax current account will remain active, so i can use as personal and business use. if not, please someone can tell me what options are available for basic accounts, which banks are good for this purpose.

(From stepchange website)

Bank accounts for bankrupts

All high street banks now offer basic bank accounts which are suitable for bankrupts. We recommend the following if you’re looking for a new account to use after bankruptcy:

Don’t apply to a bank for a new basic account if you already have debts with them
Ask the bank for a basic bank account, not a current account
Tell the new bank that you’re opening a basic account because you have financial difficulties and you’re looking for an alternative to the account you’re using at the moment

Make sure you ask when you open the account if the terms and conditions will allow you to continue using it after bankruptcy
Should I open a new bank account before or after I go bankrupt?

If you open a new basic account before you go bankrupt you can move all your income and your priority payments to the new account. This reduces the risk of missing any bill payments. The new account will still be frozen for a short time after your bankruptcy.

If you wait until after your bankruptcy the new account won’t be frozen and you can use it as soon as the bank opens it. However, you’ll need to move your income and bill payments over to the new account, and there’s a risk you may miss some payments to household bills if you don’t do this straight away.

fay66

The benefits look really low to me £580 rent and 3 children would say £420 benefits the figure doesnt seem right for only £600 income?

kissingthepink

Oh hun, I'm sure you will work it out. Hugs and kisses xx

National_Debtline

Hi John

john3105 wrote: »

thanks for your all help, was scared to be bankrupt, but all your suggestions show that i go for that, is it ok if i skip two months minimum payments before i go bankrupt to start saving money to pay fees for bankruptcy or should i borrow money from family to start application from next week.

I'm pleased to hear that you are open to the idea of bankruptcy after all. As fatbelly pointed out above, it doesn't need to be at the expense of your self-employment, though this is an assumption many people seem to make.


If you have resolved to go bankrupt, then yes by all means put an immediate stop to any existing debt repayments and use any monies saved to go towards the cost of the bankruptcy instead. You won't lose the right to declare bankrupt just because saving up the fee takes a while.


It's worth taking some further advice from one of the free debt charities before you commit to bankruptcy, just to cover all the angles.


Dennis
@natdebtline