Do we have any other option or is definitely bankruptcy?

Wonky_Halo

Hi,

I feel bad for jumping in with a question straight away, but I don't feel that I can give advice to others, since I'm clearly so rubbish at anything money related.

We owe around £35,000 on various credit cards and loans. I've been trying to consolidate over the past 2 years, but it seems I've only been delaying the inevitable.

Our monthly figures look like this:

Total coming in: £1895

Living expenses (excluding food): £2135

Total monthly pay to creditors: £2400

So, even before paying our creditors we don't earn enough to live. I might also add we have no luxuries such as SKY tv or things like that.

We also have negative equity in our house. It's worth £136,000, and we owe £138,000.

We don't have any family to support us and we've both tried to get higher paid jobs, but are on the highest we can earn. I will now be taking in ironing to pay for food and nappies.

Will bankruptcy really be the answer for us? Will we lose our house even though it's not worth anything to our mortgage lender? How will we find 6 months worth of rent to pay up front if we do lose it? My husband is British but both our families live in South Africa. If we decide to move back to South Africa during our bancruptcy year, how will it affect the bankruptcy or our life in South Africa, or his immigration claim to SA?

I'm so sorry to be another one. I feel dreadful and don't know which way to go?

Thank you for reading x

philnicandamy

first of all..welcome...NO apologies needed
your first port of call is to seek professional advice from one of the many free debt help charities (links in my sig below this post)
property isnt one of my strong points BUt someone will be along soon to hopefully help you with that question...so sit tight for a bit

Phil

Wonky_Halo

Thanx Phil

Conor_3

Is bankruptcy the answer?

Well you're legally classed as "insolvent" and TBH with that level of debt and lack of assets, BR is a good option.

THE GOOD NEWS is that you shouldn't lose the house or have to pay the OR anything to secure it other than the statutory fee but securing the house from the OR is something you must do ASAP once you've banked.

Once you've decided to bank, stop paying the creditors EXCEPT the mortgage company, utility bills/council tax and those who have loans secured on the house. Mortgages and secured loans aren't included in bankruptcy so you'll need to continue paying those.

Use the money you're saving from not paying creditors to build up your fees for declaring.

Scarlett.1974

Hi there and welcome

Like's been said, the first thing you need to do is get professional advice from one of the charity debt places. Personally I would recommend CCCS, they were fabulous with me and so very kind.

Conor's given you some good advice and I don't really have a lot to add to it (am just starting on this road myself), but I just wanted to say hi.

Keep posting. You'll get lots of good advice and support here

Broken_hearted

You could post a SOA on DFW and go through your options for cutting back.

Homework

I was going to suggest contacting CCCS or payplan but when I read the message again I realised that you are over your monthly limit each month before you pay for food. I would imagine you are eating so there must be stuff on your calculation that you are not paying.

CCCS and Payplan cannot help you when you cannot afford to eat, but if you put your income and expenditure on here everyone will help you see how you can reduce your expenditure or increase your income.

If you decide to go bankrupt you still need to have a budget that has expenditure less than income.

Richard_S

Homework wrote: »

I was going to suggest contacting CCCS or payplan but when I read the message again I realised that you are over your monthly limit each month before you pay for food. I would imagine you are eating so there must be stuff on your calculation that you are not paying.

CCCS and Payplan cannot help you when you cannot afford to eat, but if you put your income and expenditure on here everyone will help you see how you can reduce your expenditure or increase your income.

If you decide to go bankrupt you still need to have a budget that has expenditure less than income.

Hi Homework,

Expenditure exceeded income on our SOA. When we were queried about it I said that obviously we had been living beyond our means but we were trying our hardest to redress the imbalance.

It sets the scene for future negotiations; how could we afford an IPA when we could scarcely pay our essential expenditure.

Bankruptcy is the O.P's best alternative, notwithstanding how that might affect his/her plans to return to S.A.

Richard

Homework

That's why I was asking about the income and expenditure, when you are living outwith your means without buying food then even if they are bankrupt they still cannot afford to live comfortably and I suggest they post on here to see if anyone can help them by spotting a possible benefit entitlement or cheaper option.

On the information provided bankruptcy looks like the only option but unless they can change the balance of the income and expenditure things are not going to get any easier.

Richard_S

Homework wrote: »

That's why I was asking about the income and expenditure, when you are living outwith your means without buying food then even if they are bankrupt they still cannot afford to live comfortably and I suggest they post on here to see if anyone can help them by spotting a possible benefit entitlement or cheaper option.

On the information provided bankruptcy looks like the only option but unless they can change the balance of the income and expenditure things are not going to get any easier.

Hi Homework,

Obviously I can only agree with that, but if they stop paying all creditors and realise that there's no credit left then they'll balance their budget.

There's nothing like having two weeks until payday, with virtually nothing in the bank, to focus your mind; from my own experience that is.:eek: :eek:

Wonky_Halo

Guys, thank you.

Yes, at the moment we buy our food on credit, which just feeds the vicious cycle. I think I'm most worried that we will go through BR and realise that we still don't have enough to eat.

I've contacted Tax credits to see if we now qualify for more and am filling out council tax benefit forms, which should hopefully help. I'm also taking on a second job, which is not ideal but needs must.

And I've got an appointment with the Debt specialist at the CAB on the 26th of November, so I'll keep you guys posted. Thank you!! x