Personal Debt Advice - Credit cards with some complications...

BrewDog1

I owe roughly £50k on 4 different cards. I've done this to live and pay rent because my business has tanked since the pandemic. I have not defaulted yet but i'm only a month or so away from this. I have nothing. No savings, no investments, no pension, and I rent. I've cleaned myself trying to survive the last few years. I've always paid my way and never claimed benefits in my life.

The complicating/horrible part: When I applied for the cards I said I was a homeowner. I'm not. Will the actual homeowner be affected by this if I cant pay?

Secondly, I'm a company director and if I declare bankruptcy I have no idea what I will do.

I've never claimed benefits and have no idea how that might work as company director.

The nature of my business is that I could land a £50k deal this month and i'm saved but that hasn't exactly happened recently and it's hard to stay optimistic.

I'm really starting to worry. My wife does not know how bad things are.

Any advice would be very, very welcome. 

fatbelly

You could potentially do a DRO providing your total indebtedness is under 50k. However you would have to step back from the directorship for the 12 month moratorium.

https://www.gov.uk/guidance/debt-relief-orders-guidance-for-debt-advisers#directors-of-companies

If you got a windfall you would just lose the protection of the DRO, rather than lose the windfall.

Maybe run things past Business Debtline for a long term strategy.

In the short term, follow this

https://forums.moneysavingexpert.com/discussion/6496941/in-debt-and-wannabe-debt-free-first-steps-to-take-are-here-please-read-then-ask-questions

The complication in insolvency will be in working out if you have acquired beneficial interest in the property. However, these are just nonpriority debts and I see no reason why you should rush to insolvency. I'm assuming in this that it is your partner who is the owner and that is why you are concerned

kimwp

Who do you rent the property from, under what arrangement?

ManyWays

When I applied for the cards I said I was a homeowner. I'm not. Will the actual homeowner be affected by this if I cant pay?
Simple answer to this bit one, NO. They were not party to the debt you took out, it isnt secured on their house and can't be secured in future if you default.

Also if you are worried about accusations of fraud, then (a) the lender could see from your credit report that you didnt have a mortgage and (b) you have paid every payment so far, that isnt the action of someone intending to defraud the lender. 

BrewDog1

kimwp said:

Who do you rent the property from, under what arrangement?

Private landlord

PRAISETHESUN

You might be better off posting on the DFW board, where the people there will have much better knowledge on the best way to address this. I'll ask a mod to move this thread.

As above though, your debt belongs to you and won't have any impact on the owner of the property you rent. 

MSE_ForumTeam5

We've moved the thread to the most relevant board, per @PRAISETHESUN's suggestion above

RAS

An SOA would be a really good idea because you need to understand how much you need to live on, before you can decide on a debt option.

Do you have any HMRC debts? 

Being a director complicates things. Are there any other directors? 

Also have you been propping up your own finances whilst not taking income or have you been buying stuff for the business, to prop that up?