Is Bankruptcy right for us?

wot_a_life

We are paying an interest only mortgage and owe £167,000 on it ( approximately). the re-payments are £1,139.00 per month

Have been to the CAB today and they want all of our debt information. Just been working it all out and have discovered we have combined debt of £49,000

Creditors are threatening daily, can't open the door for mail!!! I have been served with a demand to pay or face bankruptcy, at least 3 cases are court pending.

Feel like throwing the towel in now, even if we could repay all of the debt, it will take our whole life span to do so, that's if one of us is not made Bankrupt first.

We will loose the house but we can't pay for it anyway at the mo.........................what do you think? Is it the easy way out, actually, is being bankrupt easy, don't know much about it

tight_jock

firstly welcome to forum. you will get top notch advice here as a rule.

Only you can make the final decision about BR when you have had a good long chat with the money advisor at the CAB. It`s good that you are already in contact.

No Bankruptcy is not the easy way out as some will have you believe. It involves a great deal of honesty and soul searching and will at times test your relationships to the limit.

However it will also give you peace and the chance to start over again. We all make mistakes and take risks in life but the law states that we can have another chance through the BR legislation.

It is not always the case that the house is taken. There are others on here who have more knowledge but a beneficial interest can be bought out. As I say I`m not sure of the details but others will be along in due course.
Good luck
:beer:
tj

wot_a_life

Thanks tj,

It's all just such a mess

How does Bankruptcy actually work? I know you have to pay a fee and go to court, then have an OR appointed to keep an eye on your finances, but how long for and what happens afterwards? Does it stay with you for life?

tight_jock

wot_a_life wrote: »

Thanks tj,

It's all just such a mess

How does Bankruptcy actually work? I know you have to pay a fee and go to court, then have an OR appointed to keep an eye on your finances, but how long for and what happens afterwards? Does it stay with you for life?

Ok...crash course according to TJ`s bankruptcy experience!!!

Make decision based on advice received from one of the agencies.

Fill in forms in triplicate

Apply for a date to your local court

Get date worry unnecessarily about the hearing.

Go to court

Spend between 30 minutes and an hour there - of which 2-3 may be with a judge or you may not even see one

Some places may arrange your Official receiver interview from the court, others will arrange a time to phone later.

After about 2-3 days you MAY have your interview by phone or (unlikely) they may request you go to the offices for one.


All creditors will be notified by the OR.

Any bank accounts you hold will be frozen by the bank upon being notified by the OR of your status

Any assets you may have will be realised. these will be identified from your paperwork and interview.

Once assets are realised, your case may be transferred to the RTLU( Trustee unit) from whence you can expect to be discharged within 2-3months.

The BR will last for 12 months from the hearing unless you are discharged.

If you have been reckless you may get a Restriction order which can last up to 15 years but these are rare.

If you have any surplus income over £100 per month, a percentage of this can be taken for a period of 3 years . This is called an Income Protection Agreement. This must be imposed during the undischarged period.



PHEW!!!!!!!!!! I hope this helps but if it doesn`t keep asking:T

:beer:
tj

tight_jock

wot_a_life wrote: »

Thanks tj,

It's all just such a mess

How does Bankruptcy actually work? I know you have to pay a fee and go to court, then have an OR appointed to keep an eye on your finances, but how long for and what happens afterwards? Does it stay with you for life?

Didn`t answer this, sorry!!

Your credit rating will be shot to bits for 6 years from the date of BR.After that , things will drop off your file.
It is possible to get credit ( if you are daft enough to want it again) but you will pay silly interest rates.

You can get a prepay visa or mastercard if you need to use a card for online purchases etc.

wot_a_life

So what about wages? do they take a percentage of that?
And things like child benefit, working/family tax credits?

If they freeze your bank accounts, can you still have your wages etc paid into them even though you can't get any money out?

fiveyearplan

No, they don't take a percentage of your wages and they certainly don't take any benefits away. Only if you have £100 + surplus per month will they take anything.

You need to have your wages paid into someone else's account. If your bank account is frozen you cannot touch anything in there until it is 'unfrozen'.

wot_a_life

So is it better to allow this creditor to bankrupt me? or would it be better to declare bankruptcy myself?

This creditor is now demanding £100 per month or they will proceed with the demand, I just haven't got £100!

I'm paying off all of my creditors at the moment monthly and I've never missed a payment. This 1 creditor is using a solicitor and they are getting quite nasty.

I am just so sick of it all, I've got £0 left out of my wages as it is as I have been paying these creditors and have really been doing my best, but I can't work anymore hours! There's just not enough coming in!

Also have mortgage arrears, can't pay them, and the next instalment is due next week, we are about £700 short of the instalment.

What is the best thing to do?? I'm in such a mess

fiveyearplan

The best thing to do is pay your mortgage if at all possible. Priority debts need to be paid first. This includes accommodation (mortgage or rent), council tax and utility bills. They have greater implications if you don't pay them.

As for the creditor making you bankrupt? How much is that debt? They often use this as a scare tactic as it costs them about £1,000 to make you BR and doesn't guarantee they'll get anything.

Is there any way you can remortgage (NOT to pay your unsecured debt it just looks like your interest only is way too high - mine is £279,000 and I pay £1,165 per month). What is the equity in your house?

tight_jock

Please, Wal, get down to the CAB or get some advice from the debt charities. You`ll find links in Fermi, Tigerfeet and Philnicandamy sigs which are liberally spread around the threads on here.

I`m not smart enough to get them into mine.....you need to be smart enough to get that info and advice ASAP.

C`mon Wal.........................you know it makes sense mate.:D

wot_a_life

Have already been to CAB tj, but got to wait about 3 weeks for an appointment with a specialist advisor.

Have already looked into remortgage fiveyearplan but the repayments would be even higher! My OH has 4 ccj's amounting to £4000 so we are finding it difficult to remortgage at a rate we can afford.

We bought the house 2 years ago for £177,000, it's now worth about £190,000?

The debt that is chasing me if from a business my OH had some years ago, it is a building company and with interest added, they want about £6,000. The business went into liquidation but it wasn't a limited company when the account for materials was opened with this building company. We thought it was so it was a bit of a shock!