Bancruptcy question

NaughtyNan

I have debts of about £21000 for two credit card, two unsecured loans and one store card. I couldn't apply for DRO as my American Express though relieved me off paying refuse to clear the balance on credit file. So according to step change charity I either stay as I am and get the occasional letter from creditors and just reply to them if I can't afford payments. I already pay the store card token payments of a pound monthly Or apply for bancruptcy.
I was paid a lump sum for my disability premium yesterday so now can afford the bancruptcy fee. However I am worried they might take this lump sum. If I withdraw it will look strange too but I don't want to lose this previous money after such hard time. I just like some advice, should I hold on applying for bancruptcy in till atclwast I used up some of the money and wait what the creditors say. I am thinking o asking the creditors of they accept token payments too.
I am constantly worried, one second want to apply for bancruptcy and next think to myself just leave it for now wait for pressure from creditors. They have all now defaulted and accepted to ask me for occasional updates on my income and expenditure.

fatbelly

You cannot apply for a DRO because you have debts of over £20k. Can I just check that you meet the other criteria:

•Must not be a homeowner,

• Can have a car worth up to £1000,

• No other assets of more than £1000 (How much do you have in savings after that lump sum?)

• Must have £50 or less left at month end, after all essential payments have been made (not inc debt repayments),

• Cannot have had a DRO in last 6 years.

Also can you list creditor, balance for each debt so we can get a better idea of who you owe money to and a more precise total.

The problem with token payments is that you continually acknowledge the debt yet never pay it off. I am sure that there must be a better strategy if you are not a homeowner.

sourcrates

Can you also explain about Amex as I don’t understand what you have written.

NaughtyNan

Hi, thank you for the reply.
I'm a council tenant, I have an old car not even worth anything near £800 it 14 year old Renault.
I don't have any savings apart from the 2565 lump sum of sdp. Had no dro.
My debts are
Barclay loan 5262
Barclay loan 3087
Barclaycard 1059
Sainsbury's card 2145
Next directory 6193
American Express 4196 I have been released from paying the debt but still shows on my credit file and I phoned them they said all it should say is partially settled. I said it still shows as owing so step change said it will count. That's why my debt are above 20000.
I pay £1 a month yo Next but it's only just been set up, second payment out on 21 September.

NaughtyNan

Sorry forgot to add I revive dla and on universal credit.

NaughtyNan

Sorry don't know how to edit posts. It should say receive not revive. I receive Disability living allowance.

fatbelly

NaughtyNan wrote: »

Hi, thank you for the reply.
I'm a council tenant, I have an old car not even worth anything near £800 it 14 year old Renault.
I don't have any savings apart from the 2565 lump sum of sdp. Had no dro.
My debts are
Barclay loan 5262
Barclay loan 3087
Barclaycard 1059
Sainsbury's card 2145
Next directory 6193
American Express 4196 I have been released from paying the debt but still shows on my credit file and I phoned them they said all it should say is partially settled. I said it still shows as owing so step change said it will count. That's why my debt are above 20000.
I pay £1 a month yo Next but it's only just been set up, second payment out on 21 September.

Great. I understand better now.

BTW you have an EDIT button on your posts so you can go back and clean them up, should you want to.

The DRO guide says:

Write off debt

To write off a debt the creditor cannot just state that the debt has been written off. A letter from the creditor must be received writing off the debt and clearly stating it will not be pursued.

If the applicant is in possession of correspondence from a creditor stating such phrases, they can choose to omit the debt from the DRO application.

By my reckoning you have £17746 of debt if you have such a letter. It would be best if you get the balance showing on Amex entry on the credit file to zero and status settled.

By the time you achieve that, your savings may have dwindled to under £1000 and you should qualify for a £90 DRO, which should be a relatively painless way to bring these debts to a conclusion.

Of course, if Amex refuse to budge, then six years after the default, the entry disappears and ceases to be an issue.

NaughtyNan

Thank you or your post. I am waiting for a response from American Express. Hopefully they decide to finally set the balance to zero as they've already set it aside anyway. In the meantime I just use my money sensibly and perhaps apply for DRO in the future. To be fair all my creditors have been very understanding so far.