I'm Not Allowed to Go Bankrupt

banksshouldworry

I just had a call with the CCCS this morning and they've told me that I will not be allowed to go bankrupt even though I have over £68k in unsecured debt. Why?

I'm in a deficit budget situation (more money going out than coming in) even once my creditors are excluded from my balance sheet. Therefore, the judge or OR would most likely not accept a bankruptcy.

I just thought I'd update you here in case it helps someone in a similar situation considering bankruptcy.

The counsellor has recommended that I pay just £1 token payments to my unsecured creditors and focus instead on generating enough income to live on.

Once I move out of a 'deficit budget' to earn something to live on we can then look at options including bankruptcy or a debt management plan (DMP).

It was great to speak to the CCCS counsellor today - she was great and I highly recommend the CCCS. Phone them on (0800) 138 1111

banksshouldworry

betterlatethannever

I don't get this. Thats rubbish.
I had a deficit budget of over £100 yet still went BR. Many, many people on here have.
I think you need to call back and double check what they said.:rolleyes:

Why not go for a second opinion and call national debtline?

diablobear

Doesn't sound right to me either. Check with NDL as BLTN said.
How does paying money, even £1 to your creditors save you from a deficit budget - it only hinders it. Use your £1's for essentials.

banksshouldworry

Thanks for the advice betterlatethannever.

When I mean a deficit - I'm talking about NOT including payments to unsecured creditors.

My income this month so far is £400 yet my expenses are around £1,150 - not including loan and cc payments. Therefore there's a large budget deficit.

Going bankrupt would not solve the problem in the counsellor's opinion and wouldn't be allowed by the OR.

I will get a second opinion.

banksshouldworry

skylight

Do you own your own home? Is there more equity in it than you have debt? Or trust fund, or anything at all along those lines????

You only would not be allowed to go BR would be if you did have assets somewhere that outweighed your debts as you would not be insolvent.


The official recievers cannot let you be bankrupt and still leave you insolvent, which is what I think CCCS mean. If you do not have enough income to cover your basic outgoings then you will be in difficulty and "could" be facing BR again in the future. How about posting an SOA up here (full income/outgoings) and we can see whats what. We have all budgeted back to the bare bones so we know what we are talking about!

skylight

Thats a hell of a deficit you mentioned! What exactly do you get and what are you paying out? Are you claiming everything you are entitled to??? Let us know and we can take a peek for you.

betterlatethannever

My god! thats a huge difference in outgoings and incomings:eek:

SL right, bankruptcy would be a disaster for you unless that problem gets addressed

banksshouldworry

You've summed up the situation well skylight.

I've only just found out about tax credits today. I didn't realise I could get them and thought they were only for families :rolleyes:

I've been advised to phone and get tax credits so that should be another £300-400/month and can be backdated for a maximum of 3 months.

Outgoings £1150

Incomings £400, (or £700 with tax credits if allowed).

There is no equity in my home - in fact it's most likely negative equity.

Therefore, still insolvent and need to increase income.

I hope this clarifies things for people in a similar situation

banksshouldworry.

blind-as-a-bat_2

I agree that with such a large defecit BR wont help you and can see why you may be refused for that reason, but im must admit i dont know if that is the case or not.

We really would need more details to offer any better advice

So_Sad_Angel

Hi BSW

Please post your SOA...then we can see the full position & also there are some CCCS advisers that post here too so maybe one will be able to look at you figures & offer further advice.

As already suggested I would call Nat Debtline though..speak to as many people as you can...knowledge is power you know!!!

You`re doing so well honey!!!

Angex

skylight

Mmmm. I am assuming that the majority of your outgoing is the mortgage?? Do you have anything secured on it? Are you in arrears? Do you want to keep the property? If you let it go with BR then you would get some benefit to help pay the rent on another place and not paying a mortgage will seriously help your I&E.
Bankruptcy is full of tough decisions and you need to think about what would be best for you in the long term without ignoring the short term too.