23K 'wiped-off' in 6 months...drastic but quick way to get rid of debt

holidayguru

Hello all,

Just wanted to share this with you-might help some people. My other 1/2 very stupidly got herself in nearly £23k of unsecured debt....quite how she did this on a take home pay of £750 PCM I don't know....from what I can gather it was banks saying 'take a loan to clear the o/draft'..etc...

To cut a long story short she had no income spare at all & even if a 'token' payment was made through a DMP she'd be paying it off for years!

We took advice & it was reccomended that bankruptcy was the best route (as law has changed now & in most cases it's 1 year maximum). She's not looking to buy a house/work in banking...etc...& she's aware her credit rating is b*****d for 6 years.

Got the Court forms...filled them all-in...as she was on a low income the court only charged a £75 fee-not the £400 odd fee it should be! Out of the court in 30 mins (did not even have to see the judge) 5 minute chat with the official receiver...appointment made to see him 2 weeks later.

I went with her. An official type 'chat' for one hour-that was it. Any letters to her re: debt were sent to the official receiver & she changed her tel. no before the Bankruptcy.

Loads of info on the web regarding maximum the receiver allows for living expenses....remarkably generous. Put simply-if no excess income then order is 1 year max in most cases.

We got back from holiday recently & she's had an early discharge (ie no longer bankrupt) after just 6 months.

So-for the sake of 30 mins in court & a 1 hour interview-24k wiped off & a fresh start-she's now triaing to be a teacher.

Before anyone gets moral & says' I've been paying ny debts for 6 years & in 4 years I'll be free' etc...I'm not saying it's right for all but in her case it was the best & quickest route.

Food for thought!

Just thought this would be of interest to all of you.

thaylock

So did you think about writing to all the creditors to offer pro-rata payments of say £200 per month for the next 10 years ? Yes that is a long time to pay off the debts, but people must fact upto their responsibilities. Personally I think the action you have taken is appalling, but we are all entitled to our opinions, I hope other people on this forum don't follow the same action you have taken. But hey, easy quick credit = easy quick bankruptcy - no problem, lets go have a party - if that's the way you think.

cougar_3

And the banks were right to force her into such a situation?

Jaelor

Hi Holidayguru - I'd just like to thank you for the insight your post provided. I too have been recommended to consider bankruptcy (me and hubby have £69k of secured debts on top of a hefty mortgage), but I am giving it a very good shot before going that route as I have a house and the disruption would be to great (new baby on way!)

However, its nice to hear from the other side of the fence and that your girlfriend is still alive and kicking and that the whole experience seemed to be, in her case anyhow, a positive one.

Dammam

This sort of post always raises many moral arguments. For example, the first thing I noticed in your post was that you had both come back from holiday which would probably fan the flames a little.
It seems that nowadays bankruptcy is such an easy option - my father-in-law took that route, unfortunately he hasn't learned a thing and I can see him going the same way again (not to mention his son & one daughter have also been bankrupt).

Whether the silly ones are those of us that struggle to pay our debts or those who find the easiest route, I really don't know.

brokenwings

Hi

as someone who might be forced to go bankrupt shortly - although i am hoping an iva or even dmp will be okd first - i think bankruptcy is a brave thing to do.

what scares me is the publicity and naming and shaming.
did her employers have to know? do bankrupts get named in the local papers these days?

jonesMUFCforever

brokenwings wrote:

Hi

as someone who might be forced to go bankrupt shortly - although i am hoping an iva or even dmp will be okd first - i think bankruptcy is a brave thing to do.

what scares me is the publicity and naming and shaming.
did her employers have to know? do bankrupts get named in the local papers these days?

I dunno if employers are told but a list of bankrupts given to Banks would mean the freezing of their bank accounts.
Eric

johannamse

truscott_uk wrote:

And the banks were right to force her into such a situation?

Did she not sign anything when she took on all the loans?

Those evil banks and the guns they hold to our heads.

Willsnarf1983

i think u wud have more sympathtic answers if u hadn't have put a title that sounded to much like gloating

personally i wud try and stay away from Bankruptcy but each to their own.....also she did sign the agreements for the credit and if she did it once then theres a good chance she'll run them up again


Will

CTT_2

I remember 25 years ago when I was made redundant and had debts of 5k and I considered bankruptsey and even went as far as going bankrupt for less than 1 day. Went back to the county court and the ordered was cancelled and got myself back in the job market and paid my debts off in 2 years. Personally I could not live with the sense of failure of letting my bank down that had trusted me to pay back. My feelings are if a person deliberately spends thousands on cards and takes out loans knowing they are unable to pay their creditors back then this is stealing. Who cares! We now living in the fasionable bankruptsey era.

jazzyjustlaw

I do think its not very nice but it worked out for your OH. If she had knowingly ran up debt knowing she could sort it out this way then it would be wrong. I think people must deal with the problems in the best way that suits them. I am sure the holiday was a welcome after such a worry, and although on first reading your post your sounding like your gloating I do think it was probably awful at the time for your OH.

I just hope she has learned her lesson. Good luck for the future.