Student and Thinking about Bankruptcy (IPA advice)

keirshunt

Hi

I am thinking about going bankrupt, well, I was. but I think my income is really high and so maybe I should be trying to pay my debts back. The reason i wanted to go bankrupt is some of the debts aren't mine (well they are in my name but they were taken out by someone else - a 'friend' and also I have a large loan I was a guarantor on.....I know, I was a fool). Anyway.....

My question is;

I am a student so I receive a loan which is a lot over the year and after all my expenses leaves me with loads of money. I have included my SOA below. Should I be thinking about a DMP instead? Or should I just pay the IPA that will be given to me?

I have also contacted stepchange by advice but they are really busy so I've had to email them. Just waiting for a reply and thought I would start a thread here just incase anyone else has been in the same situation (or will be in the future).

Thank you for any information anyone can give me



Owe £55,000 (loan and credit cards)
1 Adult
1 Child

Your Monthly Wages (after tax) 97.76
Your Partner's Wages (after tax) 0
Benefits (Working Tax Credits, Income Support, DLA, etc) 337.38
Maintenance 347
I ALSO GET STUDENT LOAN 11226 A YEAR (some of this is loan, some a grant I don't have to pay back as I'm a single parent
other jobs, 0


Mortgage payment 0
Secured/HP loans 0
Rent] 150.00
Management Charge 0
Council Tax 28
Electricity 38
Gas 30
Oil 0
Water Rates 34
Home Telephone 60
Mobile Phone 12
TV License 12
Satellite/Cable TV 0
Internet Services 0
Groceries etc. 300
Clothing 69
Petrol/Diesel 69
Road Tax (car) 12
Car Insurance (including breakdown cover) 13
Car Maintenance (including MOT) 10
Car Parking 0
Other Travel 0
Childcare/Nursery 0
Other child related expenses 0
Medical (prescriptions, dentists, opticians etc.) 10
Pet Insurance/Vet bills 10
Building Insurance 0
Contents Insurance 9
Life Assurance 0
Other Insurance 0
Presents (birthday, Christmas etc.) 10
Haircuts 10
Entertainment 0
Holiday 10
Household Emergency Fund (e.g. for repairs) 10
Add another item

Total In; 782.14
Total In (with student loan); 1717
Total Out; 906

Arleen

Even with the student loan/grant you only have 800 quid left a month, and that's before servicing debt. Granted you can easily cut some of your expenditures, so let's call it an even 1k available. 55k debt over 1000 quid is just about 55 months, also known as a lot more when interest will kick in on top of it so I think bankruptcy may be the right way for you.

KeepOnKnitting

I went bankrupt partly to allow me the financial freedom to become a student. When I started university in the September, the official receiver told me that they had no further interest in my income and would not be implementing an IPA. They may take a similar view with you since your income is mostly benefits and student loan.

macman

Is your rent really only £150pm?
And your home phone (£60) should be half that amount (line rental and presumably broadband).

keirshunt

Thanks for the replies

I spoke with Step Change yesterday for 3.5 hours in total.

They recommended a DMP but said it would take 6.5 years to pay off my debts whereas even if I pay everything I have left over to an IPA it will be 3 years maximum so I have decided that is the 'best' option for me. When I said that to the woman she could see my point.

They went through all my figures, made me increase some and said that none of them were glaringly wrong so that's good.

Terrified of doing it so will wait a few weeks.

haggis0073

if you add the revised SOA back on here from stepchange there might still be increases which you can tweak to help reduce the IPA (assuming you get one)

How much is your car worth, as you can only keep your car if you need it for work etc and the value must be around the £1000 area

When you fill in your expenditure on the BR forms the fuel section includes car parking, very often overlooked as an expense but soon adds up over the month, you can definitely up this easliy, also haircuts can be around 20-25,

how old is your child? if at school then you can include school uniform costs, these too add up over the year, If a baby then things like bedding, nappies, prams etc all add up over the year

If you get DLA then they will ask what its spent on (at least they did with me) just prepare an answer ready, although they should disregard the DLA as its for care needs

keirshunt

Thanks Haggis0073

Below is my updated SOA.

My car is worth £530 (according to the parkers website), I use it for taking my daughter to school. We live in a village and it would be 2 buses there and back, we have thought about getting rid of the car....but as it's not worth much Stepchange said it would be ok.

My dd is 14, I have included school uniform in the clothing bit. I must have put my benefits in the wrong bit as I don't get DLA, it's clearer in the SOA copied from step change!

thanks if anyone has a look and spots anything




Housing Amount
Rent £494
Mortgage
Secured loan
Charging / Inhibition order
Mortgage endowment premium
Service charge/ground rent
Water £34
Council tax (full time student so don’t pay)
Gas Dual Fuel
Electricity £68 Dual Fuel
Other household fuels
Household Services Amount Comments
Building/contents insurance £9
Telephone/mobile/internet £72
TV licence £13
Satellite £6
Repairs/maintenance
Household appliance rental
Childcare
Child maintenance
Fines/CCJs/decrees £1 CCJ:Amigo
Life insurance/pensions
Medical/accident insurance
Hire purchase / logbook loan
Transport Amount Comments
Spares/servicing £14
Road tax £12
Insurance £15
Breakdown cover £5 AA cover
Fuel/parking £117
Public transport
Food & Housekeeping Amount Comments
Food/toiletries/cleaning £275
School meals/meals at work
Pets/pet foods/insurance £16
Tobacco
Misc. Goods & Services Amount Comments
School trips/activities £4
Medicine/prescriptions £10
Dentist/opticians £8
Hairdressing £9
Union/professional fees £6
Laundry/cleaning £4
Education fees
Personal & Leisure Amount Comments
Clothing/footwear £32
Newspaper/magazines
Sports/hobbies/entertainment £10
Children's pocket money £10
Religious Contributions
Sundries & Emergencies Amount Comments
Sundries & emergencies
Loan from family/friends

No of adults 1
No of dependants 1

Your Income Amount
Take home pay £96
Any other income received £1,086 (Student Loan + HB)
Income Support / Universal
Credit
Jobseekers Allowance
Incapacity Benefit/ESA
DLA/PIP
Working Tax Credit
Child Benefit £87
Child Tax Credit £234
Child Support £347



Total Income £1,850
Total Expenditure £1,244
Surplus (Deficit) £606

keirshunt

Not sure why Amigo (of amigo loans) has a little smiley face with angel wings! I certainly do not have that opinion of them!

haggis0073

i would put food down at 275pm and then add toiletries with 25pm making 300 in total
MOT/servicing/ongoing maintenance i would put 25-30 pm
fuel/parking i would put 130pm
clothing at 40pm
add school uniforms at 5pm
hairdressing at 20pm
newspapers/stationary at 5pm
sports/hobbies at 20pm (if they ask say this is for modest uk holiday/day trips
maybe add 10-20pm for savings
i think pet foods come under housekeeping so i would reduce the pet category to 10 pm

clothing and school uniforms are 2 different sections

On the forms the prescriptions/medicines are in 2 parts, 1 part for yourself, the other for your children, if you get free prescriptions then you will need to explain what this money will be used for

If accepted that is roughly an additional £97 Per month which brings it down to around £509 surplus

There are far more experianced members on this forum who may be able to assist better than me, hopefully they will be along shortly

I am not sure if a student grant is the same as an income but someone will clarify soon i hope

silvercar

keirshunt wrote: »

Not sure why Amigo (of amigo loans) has a little smiley face with angel wings! I certainly do not have that opinion of them!

You've typed CCJ: Amigo without the space between the ':' and the 'A'. That is the smilies code for an angel emoji.

Sorry I can't help with anything more substantive.

I am not sure if a student grant is the same as an income but someone will clarify soon i hope

It is income, but you can deduct studying expenses as an extra expense is my understanding.

haggis0073

silvercar wrote: »

You've typed CCJ: Amigo without the space between the ':' and the 'A'. That is the smilies code for an angel emoji.

Sorry I can't help with anything more substantive.



It is income, but you can deduct studying expenses as an extra expense is my understanding.

so they could add studying costs to their expenditure to help bring it down a bit more, keirshunt, do you know how much your studying costs are per year? Never been a student but assume you would need books etc;