Is Bankruptcy right for me

I’m at the point where I can’t continue paying my debts. I have been using my credit cards to pay for food, bills etc but, at some point, these will max out and I’ll be left with very little. My debts are around 33k, I took out a loan 3 months ago purely to keep up with the increased mortgage payments, knowing that at some point soon I’d struggle to make the repayments. I’m worried that I won’t be able to sort this mess out especially as I’m now using my credit cards so often. I’ve looked at an IVA and unless I can increase my earnings I don’t see how I can apply. DRO is the same and my circumstances won’t improve that much over the next 5 years or so due to family issues. Bankruptcy seems to be my only option but I don’t really know what’s involved, how it will impact me, will it impact my partner? I live with my partner but don’t have my name on the mortgage. My partner is unable to work due to I’ll health so the financial burden has fallen on me and with utility costs doubling, we have a card meter and it’s costing 90 a week for gas and electric. I’m at my wits end and need advice
TIA

Comments

  • MalMonroe
    MalMonroe Posts: 5,783 Forumite
    Ninth Anniversary 1,000 Posts Name Dropper Photogenic
    Hello. Sorry to hear of your situation.

    There is help out there. I'm someone who survived what felt to me like overwhelming debt. I was helped and I'm now debt-free. You can also be helped.

    I would recommend making a phone call to one of the free debt help agencies.

    StepChange  -  https://www.stepchange.org/

    National Debtline  -  https://nationaldebtline.org/

    Citizens Advice - https://www.citizensadvice.org.uk/

    I always recommend StepChange because they helped me to turn my life around from the very first telephone conversation. They were helpful, friendly, knowledgeable and, most important of all, non-judgemental when I was in a very bad place.

    All you need to prepare before speaking to someone at one of the agencies is an SOA (statement of account) - listing all your incomings and outgoings. 

    If they feel that you are a good candidate for bankruptcy, then they will certainly help you through the process. If not, they will tell you what they feel your best option is. But you are under no obligation at any time and, certainly from my own experience, you won't be pressured either.

    Please don't delay - I wouldn't fill in any of the online forms, either, you need to speak to someone about this. I can tell you from personal experience that just being able to offload everything to someone who understood was so good. And for them to tell me that there was a way out for me was such a relief. I'm not saying it was easy but if I hadn't contacted someone in the know, I may now be in a far worse position. 

    As you say, you do need advice - and it's there for you with one phone call. Good luck, you can do this. 
    Please note - taken from the Forum Rules and amended for my own personal use (with thanks) : It is up to you to investigate, check, double-check and check yet again before you make any decisions or take any action based on any information you glean from any of my posts. Although I do carry out careful research before posting and never intend to mislead or supply out-of-date or incorrect information, please do not rely 100% on what you are reading. Verify everything in order to protect yourself as you are responsible for any action you consequently take.
  • fatbelly
    fatbelly Posts: 22,543 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Cashback Cashier
    It's always difficult to suggest a strategy when we only have partial information. If you could do a statement of affairs, format for mse, and post it either here or on debt-free wannabe, that would help.

    https://www.lemonfool.co.uk/financecalculators/soa.php

    You indicate that you have little surplus income and so wouldn't be able to do an IVA. The problem with a DRO of course is that there is a limit of 30k debt, and you have 33k

    The problem with bankruptcy may be that you are living in a house that you do not own, but in practice are paying the mortgage that is buying it. You may therefore be acquiring a Beneficial Interest, and the Official Receiver will look at that. I can't be definitive but I would encourage you to make haste slowly, and it's certainly not true that bankruptcy is your only option. In fact it may not be a very good one.
  • RAS
    RAS Posts: 34,910 Forumite
    Part of the Furniture 10,000 Posts Name Dropper
    I'd agree that you need to be very careful about your decision. 

    Have you checked whether you or your partner can get any (additional) benefits given the increased costs? 

    And considered the basics like taking a lodger?

    Really put up and SOA as fatbelly suggests and people with experience can help you.
    If you've have not made a mistake, you've made nothing
  • sourcrates
    sourcrates Posts: 31,043 Ambassador
    Part of the Furniture 10,000 Posts I've been Money Tipped! Name Dropper
    edited 10 December 2022 at 2:58PM
    Bankruptcy where a property is involved, even though your name is not on the mortgage, may not be the new beginning you are looking for here.

    As a very first basic step, with things as they appear to be, I would suspend all non essential debt re-payments, just pay your priority debts, mortgage/utility bills/CT/food etc, see if that helps for the time being.

    Non-priority debt can be dis-regarded for now, and, I would not normally recommend this as a course of action, but even missing one or two CT payments to help your situation, can be done as long as arrangements to pay are made with your council, I don`t know how accommodating your council is, ours is OK, as long as you keep them informed of your intentions, I realise not all are this easy to deal with, but if you are desperate.

    This may be able to help you on a temporary basis whilst you formulate a more long term approach to your debts.

    There is also help out there from Government for the cost of living crisis, although you have to be on a few certain means tested benefits to access most of the help available, you also have to jump through a lot of hoops in most cases as well, talk to your energy provider, they will lower your monthly bills if asked.
    I’m a Forum Ambassador and I support the Forum Team on the Debt free wannabe, Credit file and ratings, and Bankruptcy and living with it boards. If you need any help on these boards, do let me know. Please note that Ambassadors are not moderators. Any posts you spot in breach of the Forum Rules should be reported via the report button, or by emailing forumteam@moneysavingexpert.com. All views are my own and not the official line of MoneySavingExpert.For free non-judgemental debt advice, contact either Stepchange, National Debtline, or CitizensAdviceBureaux.Link to SOA Calculator- https://www.stoozing.com/soa.php The "provit letter" is here-https://forums.moneysavingexpert.com/discussion/2607247/letter-when-you-know-nothing-about-about-the-debt-aka-prove-it-letter
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