Been advised to go bankrupt

tigerfeet2006

I can't see anything in there that might be discounted and certainly not nearly £90 worth.

Your mistakes are not new they are something that the OR will see hundreds of times within a year.

JCH

I guess so, just paranoid! I think the only thing about going BR I am now worried about is the OR will take issue with the fact I took out a consolidation loan and about 10 months later started a University course (not planned this when I took the loan out) and have not been able to meet my monthly payment since. Plus overdrafts and another credit card have crept up since then too.

Keep reminding myself that they must see hundreds of people who have done similar or 'worse' things (if you can describe them like that).

Its just the fear of the unexpected!

Think I will start a BR diary next week too...really helped me to read others experiences in that format and would like to return the favour in case it helps anyone out who is thinking of going BR.

tigerfeet2006

I know it is terrifying not knowing what the OR will do and generally putting your life in someone elses hands.

A BR diary wil be fantastic as you say the others are brilliant for newbies who come to the board terrifyed of the unknown. It's great for them to read about people who felt as they are feeling at that point and to be able to read how much better and stronger that person has become and hopefully give them inspiration to turn their lifes around. Good for you.

Addicted2Chocolate

The statement is good and you have obviously out thought into it. May I suggest some dates and amounts figures to make it a fuller explanation. I have added some ideas in red. Good luck.

JCH wrote: »

I wanted to post up the statement as to why I need to go bankrupt to see what people think. Its a hard thing to write and know what to say and what not to say! Any comments would be welcomed...

I initially built up a fairly large debt on credit cards when I was in my late teens and was allowed what I think was irresponsible lending from credit card companies, given my age and income.

These debts built up at a time when I was having personal difficulties due to family issues and unfortunately took solace in spending. I was living beyond my neans from (year) to (year) by up to £(amount) per month approx.

The debts continued to grow over time due to interest on credit cards etc and through further use of credit at a time when (from (year) to ( year) I was working in a job that was not well paid, i was working as a _______ taking home £(amount) and was causing me further depression.

In 2004 I consolidated my debts into a personal to reduce the growing interest. At the time of consolidation my total unscured debts were approx £(amount) The terms of this loan meant I had to pay over £150 a month over (number) months , worsening my finanical position by interest and charges of £X (you could get this figure from the laon agreement, dont worry miss this out if you dont have it) . I quickly struggled to meet.

By the end of 2004 I was unable to pay the contractual amount of this loan as well as meet my monthly living costs of £ per month. Since then I have continued to struggle financially both whilst in work and during a period of time in higher education.

I am currently working full time but I have a low salary and continue to be unable to make my contractual payments. This situation has lead to high levels of stress for many years and caused ongoing depression.

I am stretched beyond my limits and I cannot see a way to break the cycle of needing more credit to live on due to the costs of paying my debts. The loan company have not been willing to negotiate with me or accept my solutions to the situation and at the start of this year froze my account, referring me to a debt collection agency.

This lead to a realisation that I was in serious trouble and had to take positive action to get out of a credit trap I had been stuck in for almost a decade. I took advice from numerous professionals, including the CCCS, Myvista, Citizens Advice and insolvency practitioners - all of whom suggested bankruptcy as my only realistic option due to a low income and proportionately high debts.

I deeply regret having got into this position and fear without bankruptcy, I will continue to struggle to make my payments as well as afford my basic monthly living expenses. This would result in the situation deteriorating over time, making it harder to resolve and making me increasingly unwell as a result. I have realised I cannot ignore this problem any longer and must resolve it before it gets any worse.



I have also revised my outgoings as this is the only remaining other thing I need to finalise on the forms:

ITEM HOUSEHOLD COST PERSONAL PARTNERS CONT. CONT.


RENT - £605 (I pay 302.50)
COUNCIL TAX - £75 (I pay 75)
ELECTRIC - £25 (I pay 12.50)
GAS - £30 (I pay 15)
WATER - £45 (I pay 22.50)
LANDLINE - £50 (I pay 25)
HOUSEKEEPING - £310 (I pay 200)
TRAVEL/PETROL - £40 (I pay 40)
TELEVISION - £12 (I pay 6)
PENSION - £20 (I pay 20)
CAR MAINT - £50 (I pay 50)
MOBILE - £15 (I pay 15)
DOG - £36 (I pay 18)
REPAIR/MAINT - £30 (I pay 15)
HAIRCUTS - £7 (I pay 7)
BIRTHDAY/XMAS - £20 (I pay 20)
HOLIDAY SAVINGS - £20 (I pay 20)
DRY CLEANING - £10 (I pay 10)
CLOTHING - £25 (I pay 25)
CONTINGENCY - £20 (I pay 20)
DENTIST - £15 (I pay 15)
OPTICIAN - £5 (I pay 5)

TOTAL JOINT COSTS - £1143
MY SHARE AND PERSONAL EXPENSES- £938.5

My income = £947.90 per month so I have a bout a tenner excess after paying my share and personal expenses.

Still not totally sure how to display all this on the form as you obviously get the boxes to put your expenses in and then there is a question asking what your partner contributes too. I reckon the best bet is to add an additional sheet detailing it in a table. I pay more housekeeping etc as my partner is a student.

Anyway, any views on the statement or this latest costs breakdown above would be greatly received before I commit it to the forms!

Cheers

betterlatethannever

A2C..can you please confirm something thats been mentioned on here a few times.
Is it best to NOT have too tight an I & E? in other words try not to have the same or close to the same, income as expenditure
Its been said on here a lot that the Or will be suspicious of this? is it true?

wherediditallgo

Hi A2C,

The only concern I have with your above suggestions is the line "I was living beyond my neans from (year) to (year) by up to £(amount) per month approx". If any debts were accrued after those dates, it could read as though the OP took on debt they knew they couldn't pay, because they're admitting they already knew they were living beyond their means at that point. The balance on the credit cards wouldn't have increased apart from the interest charges but for them continuing to use them, & doing so when they knew they couldn't pay them off might be seen as deliberately incurring a debt they knew they had no way of settling. Wouldn't putting such a line leave them open to a BRU if the OR felt it was warranted?

Addicted2Chocolate

I found this on the insolvency service website: Technical Manual 31.7.6
If a bankrupt's expenditure appears to equate exactly with his/her evidenced income, leaving nothing to pay into the estate, the figures should be closely examined and a full explanation sought, especially where expenditure appears to vary considerably from the averages recorded for the relevant family group in the Household Expenditure Spreadsheet.
Despite above, most peoples oputgoings are close to their income! Its when it matched to the pennny or pound it can make examiner ask few more questions. As you are putting your true outgoings you have no reason to worry at all.

betterlatethannever wrote: »

A2C..can you please confirm something thats been mentioned on here a few times.
Is it best to NOT have too tight an I & E? in other words try not to have the same or close to the same, income as expenditure
Its been said on here a lot that the Or will be suspicious of this? is it true?

Addicted2Chocolate

Living beyond your means is the most common cause of insolvency for debtors petitions, and does not imply any misconduct in itself. From the statement i thought the OP only obtained further credit for consolidation, this is fine and many people do this.
For any bankrupt, to continue to use credit cards or increase an overdraft, when they ought to have known it could not be repaid, for example after they had received advice to go bankrupt, this may be viewed as misconduct. However the explanation that their income was all taken by debt repayments, leaving them nothing to pay living expenses, is very common and accepted in my experience.
The OP of course can leave it out. The examiners job is to establish and test the cause of insolvency, so in theory the examiner should obtain this info at interview anyway.
I am off now, back tomorrow.

wherediditallgo wrote: »

Hi A2C,

The only concern I have with your above suggestions is the line "I was living beyond my neans from (year) to (year) by up to £(amount) per month approx". If any debts were accrued after those dates, it could read as though the OP took on debt they knew they couldn't pay, because they already knew they were living beyond their means. The balance on the credit cards wouldn't have increased apart from the interest charges but for them continuing to use them, & doing so when they knew they couldn't pay them off might be seen as deliberately incurring a debt they knew they had no way of settling. Wouldn't putting such a line leave them open to a BRU if the OR felt it was warranted?

tigerfeet2006

Addicted2Chocolate wrote: »

I found this on the insolvency service website: Technical Manual 31.7.6
If a bankrupt's expenditure appears to equate exactly with his/her evidenced income, leaving nothing to pay into the estate, the figures should be closely examined and a full explanation sought, especially where expenditure appears to vary considerably from the averages recorded for the relevant family group in the Household Expenditure Spreadsheet.
Despite above, most peoples oputgoings are close to their income! Its when it matched to the pennny or pound it can make examiner ask few more questions. As you are putting your true outgoings you have no reason to worry at all.

I get page not found when I try the spreadsheet link

fermi

tigerfeet2006 wrote: »

I get page not found when I try the spreadsheet link

There are quite a few "dead" links in the part of the TM and CHM that have been made available publicly.

Although the links appear to point to a valid internet address, I think the actual files and pages that are not available are hosted on the part of the IS's internal Intranet that is not available to the public.

For the OR's guidance on what is acceptable for I&E I can understand why this wasn't made available. That would allow (and tempt) people to tailor their budget to suit the guidance.
That's assuming it's deliberate rather that an IT **** up.