How to proceed with creditors when no income?

DonutMonster

Hello all,

I've gotten myself and my family into a financial mess due to not receiving much income for 18 months and not cutting back on lifestyle until recently. I personally have around £50k of unsecured debt which was mostly accrued on credit cards and loans which I used to support myself and my business while not earning.

My wife was comfortably solvent when we met and she has mortgage and house in her name only. She earns a decent salary that now supports us all. I've been a big liability for her and she has graciously supported me all the way, but I know it's eating away at her emotionally as well as financially, so it's time to take some drastic steps to remedy the situation.

At the risk of facing some harsh comments, I have absolutely no remorse or sympathy for my creditors and my aim is purely to secure the financial future of my family and not be a financial liability on them any longer. My credit file is stuffed, I have no assets. I don't care about my reputation or credit file and it's purely business with no emotions attached.

I've now started getting all the calls and letters and have been ignoring them for now as other personal matters required my attention, but now I'm starting to get my head out of the sand and deal with it.

WORK:
I work for myself, purely on commission, and have received a few pay checks in the last 18 months but nothing worth mentioning. Things have been and can be very, very good so I am reluctant to step away from what I do as I know great money can be made.

I have considered going back to full time employment, but a decent salary would require a big commute into London which is not only costly in terms of £££ but I will not sacrifice the time I have with my little one that I've desperately wanted all my life (I'm nearly 50). Also, with this level of debt I don't want have to go all through that and have my salary being swallowed up to pay my creditors. I/we are better off with me earning a smaller salary locally, paying utilities/essentials which will reduce my disposable to be distributed to creditors and carry on doing what I'm doing part time in the hope the situation corrects itself.

So I guess the £50k question is, how best to proceed with my creditors when I don't have any income right now?

They can't FORCE me to work in a job I don't want.

I hope the above doesn't come across as arrogant, but my family come first and I won't let the debt mess with my emotions.

Thanks for reading!

BoGoF

Take yourself over to the bankruptcy board. That will be the position for you shortly.

[Deleted User]

DonutMonster wrote: »

So I guess the £50k question is, how best to proceed with my creditors when I don't have any income right now?

You tell them you don't have an income right now.

They can't take what you don't have, so will need to accept token payments until you have something to offer. They'll probably want to see an income/expenditure breakdown.

sourcrates

Perfect candidate and opportunity to declare Bankruptcy and clear your debts once and for all.

Or as the debts are all non priority you pay nothing as said above.

But if it were me, I would act now to rid myself of them.

DonutMonster

Deleted_User wrote: »

You tell them you don't have an income right now.

They can't take what you don't have, so will need to accept token payments until you have something to offer. They'll probably want to see an income/expenditure breakdown.

That's what I am thinking but want to be 100% sure that my wife is protected as it's not her debt.

I did contact a couple of creditors recently and one actually said they couldn't accept a token payment but I paid it anyway (it was like £5 instead of the £90 they demanded). Another said there was no point filling in an income/expenditure form as I don't have any (I'm glad they recognised that!). All that I contacted suggested StepChange, but I said I didn't want to go down that route as I'm hoping to work my way out of it in a few months.

DonutMonster

sourcrates wrote: »

Perfect candidate and opportunity to declare Bankruptcy and clear your debts once and for all.

Or as the debts are all non priority you pay nothing as said above.

But if it were me, I would act now to rid myself of them.

It's something I'm seriously considering. I'm exploring the consequences (although don't care about the stigma of being declared bankrupt).

enthusiasticsaver

If you have no income then I can't see any other option other than bankruptcy. If the house is in your wife's name they can't touch that. Do you have a car or savings or any other assets? Make sure you are not financially linked to your wife. No joint accounts.

sourcrates

DonutMonster wrote: »

It's something I'm seriously considering. I'm exploring the consequences (although don't care about the stigma of being declared bankrupt).

There is something called beneficial interest with regard to the house.

You may want to take advice from a debt charity before committing to anything.

DonutMonster

sourcrates wrote: »

There is something called beneficial interest with regard to the house.

You may want to take advice from a debt charity before committing to anything.

Hmmmm, thanks for telling me about that.

I've never contributed towards the house. I used to give her money for food and bills, but she has always paid the mortgage herself from her own account.

I haven't contributed, I've drained her.

fatbelly

Debt advisers will always warn about beneficial interest to cover themselves but I've personally never come across an actual case in 18 years of debt advice.

Stepchange are great if you want a fee-free debt management plan but that's not on the cards here.

Token offers are (literally) a waste of time. If you are going bankrupt, get on with it. If you want to check that you haven't missed anything (though the application process is now frighteningly simple) run it past National Debtline.

enthusiasticsaver's take on this seems good to me.

Suseka97

DonutMonster wrote: »

It's something I'm seriously considering. I'm exploring the consequences (although don't care about the stigma of being declared bankrupt).

I have nothing to contribute in terms of solutions beyond what has already been said - but I did want to pick up on this comment. To be honest I don't think such a thing (stigma of being declared bankrupt) exists much, if at all, nowadays. Due to circumstances beyond their control, many people and businesses have had to turn to this way of resolving their financial crisis over the years.

My sister had to declare herself bankrupt in the 80s and yes, back then it was seen as some sort of failure on her part - but she had no choice. Sadly she lost her business and the home that came with it. Nowadays it's much easier for folks (and by that I mean the process) and I imagine that people would only know if you told them.

Anyway - whatever route you choose I wish you luck and applaud your resolve to lift yourself (and your family) out of the situation.