Debts & IPA

mjmoose

Hello all!

I have a few questions, so please bear with me!

I was declared bankrupt on 30th January 2019. I have had the telephone interview with the OR to go over my application. As I am employed, my case has to go to the office that deals with IPAs. The OR was quite sure I wouldn't end up paying one as the majority of my income is from benefits. My phone call with the IPA office is tomorrow morning and in all of my research in what to expect about the process, I've come across some worrying things!!

1) Should my council tax be included as a debt in my BR? Prior to going BR, I'd applied for council tax support so we are paying 30% less per month. I've been online to make a change to the date I pay and to request I pay over 12 months, but as that wasn't picked up straight away, I had a letter saying as I'd missed a payment, I now had to pay the outstanding CT in one installment. I haven't yet. And that was last month now, I believe. I have also applied for CT hardship payment. In my interview, the OR didn't ask about CT at all. But I'm reading on the boards here that it should be included for the rest of the tax year. Could that be why I haven't heard from the Council, as they've been contacted by the OR? I know it would be quicker to just ring up and ask. Can I just ring up the CT dept and advise them of my BR?

2) I am reading about energy debt being part of the BR. Is this correct? That the outstanding amount before BR should be cleared and the account balance set to 0? Again, this hasn't been added to mine, and I've never been asked about it. However, my energy (in my name only) is £750-odd in debit. I last made a payment 2 days before BR. I have applied for help from the energy supplier's trust fund to contribute towards my fuel debt. Is this okay to still do, or should I cancel the application, as that could be seen as preferential payments?

3) I have a joint bank account with husband - the only financial link we have. I have debts with the bank. Husband does not. We both don't use the account anymore, but it's still open and available to use, but no money is paid in or comes out. Should we still close it so it doesn't impact husband's credit rating, or is it too late for that as I am already BR? The account is currently £22.98 in unarranged overdraft from some DDs that came out before I could change them. Should I pay this off? Or will it become part of the BR even though it occurred after BR? Could it be counted as preferential payments?

4) If I apply for a discretionary housing payment to help with rent for 6 months, do I tell the OR that as it will mean we're not paying as much for rent for that time? Also, on that form it asks about my debts. Do I still include my debts, or not as I am BR? Would I just explain I'm BR instead?

With all of the above in mind, if I am going to need to speak to OR, should I do that before the IPA phone call?

I think that's all my questions. I'm sorry for such a long post! I thought I had done all of my research and had everything sorted before I went BR!

Thanks in advance of any help!!

sourcrates

Hi,


You really should of obtained answers to these questions prior to your bankrupcy, phone one of the free debt advice charities in the morning, they will be able to help.


I do know your current years council tax can be included, you need to speak to your council about this.

Annie35

As I understand it,

1. Council tax, if it's joint names with hub he takes on the debt & will continue to pay this, if it's just your name any debt from April 18 is wiped , you don't make any more payments till April 19.

2. Assuming fuel is just in your name the debt is wiped, therefore no payment will be due from the trust. IF in joint names with hubs he takes on the debt & will need to apply for the trust funds himself.

3.Joint bank account, the £22 overdraft is now your hubs, I don't know if it's too late but if you're not using it anyway might be as worthwhile closing.

4. Is this a household payment in both yours/hubs name? If so you should fill the forms stating your 0 debt but include any hubs has.

If you get a payment in your name you need to tell the OR (within 21days after payment received) & it'll prob be counted as an income & may affect your ipa, if it's a joint payment you should only be counted your 1/2 for assessment (I'm assuming it's a grant, not a loan?) If it's a loan please say. Is it possible for hubs to apply for this singularly? Might be easier.

When you speak tomorrow just tell them as it stands today, don't tell them you may get this grant, that grant etc as that'll just confuse things, you may no longer be eligible for these grants now for instance (& if hubs applies it's none of your ORs business anyway )

(This is just my thought, someone else may think otherwise)

TheGardener

mjmoose wrote: »

...1) Should my council tax be included as a debt in my BR? Yes for the current financial year so your liability will re-start from 1st April. This means (given the fact we are nearing the end of the financial year) that the OR will almost certainly allow sufficient in your budget to pay CT from April onwards. However, it also means that any other eligible adult living with you would be responsible for the CT at your address until then.

2) I am reading about energy debt being part of the BR. Is this correct? That the outstanding amount before BR should be cleared and the account balance set to 0? Your Fuel debt must be included. you don't have to list it on the forms, the OR will assume it has been included. You need to let your supplier know.

3) I have a joint bank account with husband Aaghhh! :eek: you should have sorted this before you went BR. The impact will be that your husbands credit history will be trashed along with yours. Change this now - the only financial link we have. I have debts with the bank. Husband does not. We both don't use the account anymore, but it's still open and available to use, but no money is paid in or comes out. Should I pay this off? Yes, immediately and close the account.

4) If I apply for a discretionary housing payment to help with rent for 6 months, do I tell the OR that as it will mean we're not paying as much for rent for that time? Also, on that form it asks about my debts. Do I still include my debts, or not as I am BR? Would I just explain I'm BR instead? If you are BR - you have no debts (unless they are student loans/court fines etc.) this will obviously affect your claim for discretionary relief.

As sourcrates says, its a bit late for these questions. But you can still iron out a few of the wrinkles if you move quickly.

mjmoose

sourcrates wrote: »

Hi,


You really should of obtained answers to these questions prior to your bankrupcy, phone one of the free debt advice charities in the morning, they will be able to help.


I do know your current years council tax can be included, you need to speak to your council about this.

I know. As I said, I had done all of my research and worked with StepChange and trawled sites like this one. It's only since looking on the post-BR forums that I have become aware of the CT and fuel debt info. I honestly wasn't made aware of this before now, or I would have sorted it! I had pages of questions written down to ask every time I spoke to StepChange etc and it took several months before actually going BR that I thought I knew everything when I sent the application off! Thanks for your reply, though. I'll make some calls in the morning! IPA call is at 10:30am so I'll have time.

mjmoose

Annie35 wrote: »

As I understand it,

1. Council tax, if it's joint names with hub he takes on the debt & will continue to pay this, if it's just your name any debt from April 18 is wiped , you don't make any more payments till April 19. It is joint so I guess they will issue a new notice for the rest of the tax year citing his liability? Will the OR have contacted the council about this even tho CT wasn't mentioned on BR form, or is it up to me to notify the CT department?

2. Assuming fuel is just in your name the debt is wiped, therefore no payment will be due from the trust. IF in joint names with hubs he takes on the debt & will need to apply for the trust funds himself. Fuel is just in my name. I will contact them tomorrow to let them know the situation.

3.Joint bank account, the £22 overdraft is now your hubs, I don't know if it's too late but if you're not using it anyway might be as worthwhile closing. Thanks. Will close it this week.

4. Is this a household payment in both yours/hubs name? If so you should fill the forms stating your 0 debt but include any hubs has.

If you get a payment in your name you need to tell the OR (within 21days after payment received) & it'll prob be counted as an income & may affect your ipa, if it's a joint payment you should only be counted your 1/2 for assessment (I'm assuming it's a grant, not a loan?) If it's a loan please say. Is it possible for hubs to apply for this singularly? Might be easier. It's a grant - not repayable. It goes directly to the landlord, too, it doesn't come to us. Will probs get husband to apply for this instead.

When you speak tomorrow just tell them as it stands today, don't tell them you may get this grant, that grant etc as that'll just confuse things, you may no longer be eligible for these grants now for instance (& if hubs applies it's none of your ORs business anyway ) Stellar advice, thank you! I've a tendency to over-explain and waffle so I shall keep the call to the point tomorrow! She did say it should only take 10 minutes...

(This is just my thought, someone else may think otherwise)

Thank you for taking the time to reply. I really appreciate it!

mjmoose

"
...1) Should my council tax be included as a debt in my BR? Yes for the current financial year so your liability will re-start from 1st April. This means (given the fact we are nearing the end of the financial year) that the OR will almost certainly allow sufficient in your budget to pay CT from April onwards. However, it also means that any other eligible adult living with you would be responsible for the CT at your address until then.

Thanks for this. CT was included as household expense in the BR form.

2) I am reading about energy debt being part of the BR. Is this correct? That the outstanding amount before BR should be cleared and the account balance set to 0? Your Fuel debt must be included. you don't have to list it on the forms, the OR will assume it has been included. You need to let your supplier know.

Thanks. I will contact my supplier first thing tomorrow. Would it be worth switching supplier (we have a local, cheaper alternative and MSE energy club rightfully informs me I am now over-paying for fuel) and my husband being the account holder instead of me? Or does it not quite work like that??

3) I have a joint bank account with husband Aaghhh! you should have sorted this before you went BR. The impact will be that your husbands credit history will be trashed along with yours. Change this now - the only financial link we have. I have debts with the bank. Husband does not. We both don't use the account anymore, but it's still open and available to use, but no money is paid in or comes out. Should I pay this off? Yes, immediately and close the account.

I will pay this now and triple check every single DD to make sure nothing else comes out. Then we'll close it. It'd be so much easier if we could close it online/over the phone as it's PITA getting to branch but it needs to be done. I hope it's not too late as husband has good credit rating and I never wanted to drag him down with me, hence all debts being just in my name I think I've avoided closing it as the bank are one of my creditors and I am so awkward dealing with them without giving away that I was going BR. Don't need to worry about that now, I suppose.

4) If I apply for a discretionary housing payment to help with rent for 6 months, do I tell the OR that as it will mean we're not paying as much for rent for that time? Also, on that form it asks about my debts. Do I still include my debts, or not as I am BR? Would I just explain I'm BR instead? If you are BR - you have no debts (unless they are student loans/court fines etc.) this will obviously affect your claim for discretionary relief."

Thank you for this explanation! I have a bit confused as to whether I still had debts until I was discharged, or whether the debts were gone when I was declared bankrupt.

TheGardener wrote: »

As sourcrates says, its a bit late for these questions. But you can still iron out a few of the wrinkles if you move quickly.

Thank you so much for your help. I really appreciate it!