Family member has to pay back given to her

ighorsewoofighorsewoof Forumite
5 Posts
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MoneySaving Newbie
Hi I hope someone can help me I have gone bankrupt due to ill health
i gave my daughter 15800 7 months before I went bankrupt will the agent give her time to pay it back 
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  • MorfxMorfx Forumite
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    Yes, no doubt it will have to be returned. Questions will no doubt be asked how you got into your situation within after giving away such a large amount.
  • ighorsewoofighorsewoof Forumite
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    it was not just that it was a loan I took out had no money troubles then just wondered if she would get time to pay 
  • fatbellyfatbelly Forumite
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    It's one step at a time. You declared the loan on your application, and the reason for iit.

    The OR will decide if any action needs to be taken against either of you.
  • debt_doctordebt_doctor Forumite
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    it was not just that it was a loan I took out had no money troubles then just wondered if she would get time to pay 

    Hi,
    The OR will want a full explanation. If I understand correctly, you took out a loan for £15,800 7 months prior to BR and gave it to your daughter.
    So the questions begs - Why did you do this? 
    Further considerations are, does your daughter still have the money, does she own property and what are her means to pay?
    DD
    Debt Doctor, Debt caseworker, Citizens' Advice Bureau .
    Impartial debt advice services: Citizens Advice Bureau Find your local CAB *** National Debtline - Tel: 0808 808 4000*** BSC No. 100 ***
  • Minkym00Minkym00 Forumite
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    If you were solvent at the time of giving the money away then this isn’t a misconduct. Your daughter will get time to pay it back. What’s her financial position?
  • ighorsewoofighorsewoof Forumite
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    MoneySaving Newbie
    Will pay it back within 11 months before discharged 
  • mwarbymwarby Forumite
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    Minkym00 said:
    If you were solvent at the time of giving the money away then this isn’t a misconduct.

    it does all rather depend on what caused the OP to become bankrupt, the OP may have been coping fine and a major life event forced insolvency, on the other hand it could have been a case of living beyond means for years until the payments just got too much. In the first case yes the OP may well have been solvent and took loan in good faith, in the latter case it not so clear.
  • Minkym00Minkym00 Forumite
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    mwarby said:
    Minkym00 said:
    If you were solvent at the time of giving the money away then this isn’t a misconduct.

    it does all rather depend on what caused the OP to become bankrupt, the OP may have been coping fine and a major life event forced insolvency, on the other hand it could have been a case of living beyond means for years until the payments just got too much. In the first case yes the OP may well have been solvent and took loan in good faith, in the latter case it not so clear.
    In order for a misconduct of this nature to be proved the OR will need to prove two tests of Insolvency - income / expenditure and asset / liability. If they only meet one of the tests (i.e. they didn’t have assets to cover the debt but could make the repayments or couldn’t make the repayments but had assets to cover them) then there is no misconduct. Simple as that.
  • mwarbymwarby Forumite
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    I suspect many who have been insolvent would fail both tests at some point on the road to insolvency(no assets, but juggling loans until reality hits), but few would suffer consequences, this AFAIK is more for the more blatant cases (eg was in debt, no savings, lost job, took out another loan for big holiday)

    For corporate insolvency there is I believe an assumption that the corporate has someone competent managing the finances and so should know when they risk failing those tests. 

    For personal insolvency while it’s still technically misconduct I think there is less assumption of financial competence and allowances made, the assessment then IMHO becomes did the debtor know or strongly suspect that they would be unable to repay the loan 
  • macmanmacman Forumite
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    Doesn't this rather depend on whether the daughter acknowledges the debt at all? If this was the usual informal 'pay me back when you can' style arrangement, with presumably nothing in writing to prove it, then she may view it as an open-ended gift?
    No free lunch, and no free laptop ;)
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