Have today been made bankrupt

Merc2023

hi all. Have this morning been made bankrupt, the circumstances around this are I signed a personal guarantee when I had a business a few years ago and the creditor has made me bankrupt ,

I have no assets in terms of property or possessions I do have a car on HP which I need for work

The Judge said I will recieve a questionaire so what will happen next? I already have a monzo account. Do I need to get the cash out of that?

In terms of the meeting with the OR. When will I hear from them and how are they? I'm thinking the court part was the east part. But finding the prospect of the OR delving into my finances quite daunting.

Any advice would be great

cymruchris

https://forums.moneysavingexpert.com/discussion/6443828/have-today-been-made-bankrupt

It's unusual to my knowledge for a creditor to push for bankruptcy if there are no assets - but if that's what's happened, then the process has to be followed through. Usually in bankruptcy all accounts are frozen, so you should have a cash reserve to tide you over for the next few weeks while you get your finances straight. Other's can confirm, but my understanding is that you should already have had the cash in hand prior to the bankruptcy this morning, but I would certainly get any remaining credit balance transferred out/withdrawn asap. (The OR at a later date may challenge this - but you'd say you needed a safety cushion for essentials such as food and energy as you knew the accounts would be frozen).

You would now also look to open a basic bank account (probably tomorrow) - so that you can have access to ongoing banking facilities. You'll have to get your employer to make your salary payment into this new account. What direct debits do you have? They'll all fail once the accounts are frozen.

The OR will inform all of your creditors that you've gone bankrupt when they freeze your accounts - but you may still have to call them to inform them of it, as the OR sometimes can be a little slow, and people start chasing for money owed. (You just need to quote them your bankruptcy case number - and sometimes send a scanned copy of the bankruptcy order).

The actual interview with the OR is usually fairly straightforward as long as you're open and honest with them. All they're really looking for is how you got to where you are, and that you haven't been deceptive in your dealings. Be honest with them, explain your circumstances, and they'll tell you what you can and can't do next. Don't try to hide anything from them.

If you look at your outgoings (excluding debts that will be included in your bankruptcy) - is there a surplus when it comes to your monthly salary?

In terms of the car - you might need to have a look at the contract to see what it says about bankruptcy/defaulting. Is it a lease hire or a purchase on finance (as in the car is yours at the end). You're entitled to own a car - but generally it needs to be worth very little. (circa £1k).

Brie

As I understand it a car on HP is excluded from any calculations as it's not a loan per se nor is it ownership. The problem may be that if you need another HP deal in order to keep a car (i.e. can't afford to buy one outright) then you may have real problems. You might want to see where you are in your HP deal to see if you own any value in the vehicle that you could retain in some way - which might include handing the car back, getting a small amount for what you own and then buying another much cheaper vehicle to keep you mobile.