Being chased for money (car on finance) after bankruptcy discharge

FocusFord

Hi,

After a year of hell my partner was discharged from bankruptcy in June this year. We are just starting to get our lives back on track. Today we had a letter come through the post asking for the OR’s share in the car my partner has on finance. This was listed as an asset when he was made bankrupt a year ago but we assumed that they didn’t feel it was worth pursuing. Now they are asking for over £3,000.

I’m so stressed out. Can they really pursue this after discharge?

Thank you.

thevdm

Hi, is the car on hire purchase or another type of finance? Is the finance still being paid or has the final payment been made?


Stepchange have a short section on cars and bankruptcy which covers some of the rules related to cars on hire purchase. https://www.stepchange.org/debt-info/bankruptcy-and-my-car.aspx


The OR can arrange the sale of items after the bankruptcy is discharged (obviously only assets that were owned during the bankruptcy), for houses this is usually within 3 years after discharge, I can't seem to find a time limit on other posessions.

WhenIam64

Do you still have the car, what was it value at the time, and was it in a protected arrangement with the OR?

Was the finance for the car in joint names?

TheGardener

Its hard to work out whats going on from your post. At the point of the BR - what value was put on the car? I take it the OR allowed the finance to continue and the finance company were ok with that?
As you know, unless there are special circumstances, a BR who needs a car is allowed a vehicle worth upto £1000. If their vehicle is worth more than that, then the vehicle is usually sold and the BR retains £1000 to buy another car and the balance is claimed by the OR as an asset.
Was your car close to the end of the finance agreement? Did the OR decide to wait until the car was paid for before claiming the asset ?
Do you have anything in the paperwork and letters you may have missed relating to the car?
If a car was 'exempted' you would normally have received a letter of exemption specifically for the car.

FocusFord

Thank you all for your replies. It was bought as hire purchase in Jan 2017. A deposit was paid of £4K and monthly payments have never been missed (8.5K total) I have paid them on behalf of my partner when he had no income. Car has been valued at 8K with 5k outstanding finance to be paid from now. They have said 8k - 5k = 3k owed to them. I have rounded up all the figures for ease. They knew about the car from the outset. I don’t understand why they’ve left it until this point to ask for the money. I thought that once he was discharged that was that.