DMP or Bankruptcy??? I'm in a mess. Please help

927

I owe £27000 to Barclaycard, Halifax, Virgin and MBNA all credit cards and have no way of paying any of it. I have contacted stepchange, national debtline and citizens advice. SC advised bankruptcy. Citizens advice advised token payments. All the creditors want a dmp.

My income is benefits and child support £1884 a month and my outgoings are £1862 a month. I do have a car which is worth approx £1200. I use this to take my child to nursery (and will also have to use it to take him to school) as we live in a rural area. My parents have offered to pay any excess if the OR took it as an asset. I rent privately.

I just want this debt gone but don't see my situation improving dramatically. Really worried and anxious. When I contacted creditors today they all said they manage debts inhouse (not dca's) as I'd asked about full and final settlements as a relative said he could give me £12k but only for a f&f. All except virgin said they didn't accept them.

Can someone please advise me, pros and cons?

sourcrates

Hi,

You seem to of thought this through pretty well, forget token payments, they are a waste of time, DMP, you do not have sufficient disposable income to do one.

Bankruptcy is a big step, but not as costly as it once might of been, as long as it does not effect your employment you can pretty much carry on with normal life.

One tip, make your budget show a surplus of less than £20 (close now) and you will not get an IPA.

From what you have said it appears to be your best option, however, they are all non priority debts credit cards, you could ask them to write off the debts first, failing that you just need the £680 bankruptcy fee.

927

Thank you for reply. How do I increase expenditure on SOA - stupid question really but I’ve tried to budget a bit so it appears I will be able to live within my means. I’ve averaged 12 months of fuel and food and I’ve put £340 in for food. I anticipate fuel will go up a bit as my child will be going to nursery another day a week from September.

Doesn’t the OR go through all my bank statements and cc (barclaycard is the only used for purchases) to see what I’ve spent and then once I’m bankrupt to check my expenditure? Bit concerned car won’t be classed as exempt too.

I contacted all four creditors today to offer full and finals and Halifax said they don’t ever do them, Barclaycard the same. MBNA said write in and Virgin said they may consider it but only if my credit file showed defaults. I have only defaulted on one card (theirs) this month-the other accounts are on hold until 23rd July. I stressed on the phone that I have no money to pay them and my only other option was to consider bankruptcy.

Karonher

If it is just you and a child I would doubt you will get away with putting £340 in. Having read other threads on the site it seems to be around £220 for an adult and less for a child so it could depend on the age and it seems yours is very young. You would probably have to fill in an expenditure sheet, so it could depend on what you are spending the rest of the money on.

927

I’d read the same for adult with £115 for child. Can’t remember where though.

927

Pressed post too soon!
Rent is 850
Utilities is £113
Mobile 20
Bband 25
Car fuel 90
Tax 17.60
Insurance 38
Mot and servicing 15
Toiletries 20
Swimming lessons (child) 60
Parking 5
Laundry 5
Smoking 5
Alcohol 5
Pension 20
Contents ins 8
Emergency 20
Haircuts 15
Opticians and dentist 36
Tv licence 12.47
Groceries 340
Clothing 45
Gifts 15
Child dentist 8
Leisure 20

The reason I’ve filled all these in is because I thought the SOA is meant to be what actual spending is now?? I understand some things may go up or down.

fatbelly

That all looks ok to me.

Where did you get your car valuation from? Try parkers guide - poor condition. Ideally you want a value of less than £1000

927

I did get a valuation from Parker’s, autotrader and took it into a dealership. I couldn’t find a way for Parker’s to quote me poor condition except for private sale which comes out as £840. It is in poor condition. Dealership said they wouldn’t touch it and £800 and autotrader for fair condition £1410. Do I use Parker’s poor condition private sale price?

fatbelly

927 wrote: »

I did get a valuation from Parker!!!8217;s, autotrader and took it into a dealership. I couldn!!!8217;t find a way for Parker!!!8217;s to quote me poor condition except for private sale which comes out as £840. It is in poor condition. Dealership said they wouldn!!!8217;t touch it and £800 and autotrader for fair condition £1410. Do I use Parker!!!8217;s poor condition private sale price?

Parkers gives values as follows

Franchised Dealer:
Independent Dealer:
Private Good:
Private Poor:
Part Exchange:

The one I use when valuing a car for a DRO application is Private Poor. If it's saying £840 for your car, save or print that page and put that as your valuation on your bankruptcy application.

Sncjw

Why not fill in a soa. Also why are you paying for your child to see the dentist. It!!!8217;s free for children

927

Thank you - the car has heaps wrong with it, electrics, air con doesn’t work etc. Fine for me doing run around a bit resale not so good. I’ll use the private poor value. Thanks so much.