Bankruptcy Questions

edited 30 November -1 at 1:00AM in Bankruptcy & Living With It
17 replies 1.1K views
PMS78PMS78 Forumite
14 Posts
edited 30 November -1 at 1:00AM in Bankruptcy & Living With It
Hi there, thank you for your time and help with my unfortunate situation.


I have an issue with debt surrounding a property jointly owned with an ex from 10 years ago. Long story, but he is not a very decent sort and has refused to sell this property for the last 10 years and has now had it reposessed, along with not paying council tax and water rates. He had gone 'Off Grid' all those years ago to avoid paying maintenance etc etc..



Anyway I am now being harassed by these companies, and the worst being the council tax, which is now urgent. I have informed them of the situation etc, but they basically said, unfortunate as your circumstances are, we dont care, we want our money! Nice eh? I have 7 days to get the ball rolling on Bankruptcy, yes this is my only option and I have had professional advice.


However I need advice on the following:


1. My new job, which is temporary, gives me a wage that is too high, well too high for what they deem acceptable and less than 1400pcm, and will tie my into an IPA for 3 years! Not acceptable from my moral standpoint in this situation.. If I can change my hours and drop a day, this will take me to a level that will not tie me into more hardship for 3 years! 1 year of pain is better than 3 right? Will this be a problem with the OR? The company intend to take me on permenant at the end of September, but I will need to negotiate this earlier.


2. Great timing NOT, I am due to get married on the 14th September, how will this affect the situation and my new husband?


3. My new husband to be, is furious about this situation and will not have any involvement at all, he outright refuses to declare his income and we both pay 50/50 on the joint bills, our money is seperate and I have a son from the previous disaster relationship! How do I deal with this and the OR?


4. Also my car, which is worth less than £1000 is up for sale, as it is too costly to run tbh, and I will have to use the spare cash to repair a car I borrow from my father, how will this be affected?


5. I rent the house we live in off my father, who is a business man and there are not special favours, other than he let us move in without a deposit and we also pay an inclusive rent, including all the gas/elec, water ad council tax. Again how will this affect the situation? As much as I am his daughter, he will not stand for no rent, this is his retirement pension etc.



6. In regards to the council threatening to get a liability order very soon, once I apply, will this stop a liability order being gained and therefore rendering that debt outside of the bankruptcy?



Thank you in advance, I hope someone can help.:(
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Replies

  • Minkym00Minkym00 Forumite
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    1. What do you mean by “well too high for what they deem acceptable”? If you are deemed to have surplus income then an IPA will be set up. In fact, you may get two - one for any surplus income once your reasonable expenses have been assessed, and one to claim your tax for the rest of the financial year (you get a nil tax code as a bankrupt). If your income changes significantly during the three years you simply tell the OR and it will be reassessed to a more appropriate amount. It’s not set at the same amount for the entire period, it’s not imposed to cause you financial distress.

    2. No reason why it should affect your new husband, except maybe if you want a mortgage in the future? It might be a bit harder to find a decent offer.

    3. He doesn’t have to declare his income. Just put your income and 50% of the household bills on the application form.

    4. No reason I can think of that this would be a problem. There might be a couple of questions about why you are repairing a car you don’t own, and not your dad, but you need a reliable car.

    5. Fine, as long it’s market value. The OR won’t expect you not to pay him any rent.

    6. Applying for bankruptcy won’t stop the liability order but, once granted, will render the liability order unenforceable. All debts pre-bankruptcy (save for a few types that aren’t relevant here) will be covered by the bankruptcy order.
  • PMS78PMS78 Forumite
    14 Posts
    Thank you for your reply. I have been on the bread line and struggled for a very long time. Luxuries, such as a modest camping holiday, some reasonable clothing or having a meal out once in a while, where things I could only have if family paid for these. It has only been in the last couple of years, that things that others take for granted have been available. Now I have finally got myself a reasonable job earning 19500k a year that I have found myself with spare money at the end of the month, this being only in the last 6 months...



    I live quite frugaly and after completing an SOA I found that I would be locked into an IPA for 3 years, which I have found quite upsetting tbh. I am not living a high life and this debt is not from a situation that I have had any control over. So I am absolutely miffed off and would rather go back to earning just enough for another year, rather than face 3 more years to add to over a decade of this. I have the option of lowering my income and if this is not going to land me in hot water with the OR, then I will take it.



    Although no they do not force you into financial hardship, they are quite restrictive from what I am seeing. You know I have had severe back pain and other issues as a result of a muscle imbalance and I finally have been able to address this by going to classes,these are not allowed, how is this fair? My son has had to make do without extras, that he sees his friends have all the time (not that he complains, although sometimes I see his little heart quietly breaking), recently seeing the joy in his face because I can take him places and have little treats and buy things for his remote control cars that he loves, has been lovely. We have been able to go to trips out to places and have meals out, which to us is a big deal, after years of barely affording the fuel to drive to the beach.



    This debt is a result of a man who was that awful, I had to plan carefully to leave him and ended up getting a restraining order against. I have had no choice in this, I sought legal advice on several occasions and found that I could not force the sale of the property without paying out 6k plus in legal fees! 6k that I most certainly did not have. This is not the result of irresponsible behaviour on my part, that I am trying to evade to carry on some high life, let me assure you.


    Sorry for the rant, but I am so angry and upset that he has done this to us yet again! I just want to be free of him and now his debt.
  • Minkym00Minkym00 Forumite
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    Where have you been looking for information on allowable expenses? First off you really need to post your true SOA up here for advice and go from there. You will get great advice on what amounts to claim in each category.
  • edited 1 September 2019 at 8:52AM
    PMS78PMS78 Forumite
    14 Posts
    edited 1 September 2019 at 8:52AM
    I have been trawling the forums and I also found a sheet on living expenses from a financial advisor. The insolvency practitioner I saw seemed to think that they do not allow for holidays or pets, which left me confused, as that is not what I see on the forums.


    This is the SOA, I did do it on excel, but it had a wig out on here and was all over the place, if anyone has a template, I would be grateful.





    Rent 475 (all inclusive of bills)
    Contents Insurance 8.61
    Virgin 20.5
    Netflix 4.50
    Groceries 250



    Car tax 23
    Car Insurance 50 (I have 2 years NCB)
    Car maintenance 30 (the car is old and would cost more than this if we did not DIY!)
    Fuel 160
    AA 10
    Son Bus 45
    Son School meals 45
    Son Trips and extra curricular 40
    Clothes 50
    Hair 20
    Mobiles 25
    Bodybalance 44 (excercise classes for my muscle imbalance, not diagnosed by my GP)
    Medical (dentist etc) 20 ( I cannot get an NHS dentist for my son anymore, they are all stopping it, so is probably more)
    Holidays 20


    Total Outgoings £1340.61

    Income:
    Wages £1373
    Child benefit £81
    Total Income £1454

    Surplus £113.39
  • PMS78PMS78 Forumite
    14 Posts
    My dog costs me about £7.50 a week in food and I no longer have insurance for her.
  • PMS78PMS78 Forumite
    14 Posts
    Sorry, I am really stressing about the council getting a liability order! I have been reading that if they get the liability order before I go bankrupt, they can still send baliffs and chase this debt. Can someone please clarify this? I suffer with extreme anxiety attacks and the thought of the heavies coming around to harass me at my home is too much. I dont own anything of value, but my partner has lots of mehcanical tools he has built up over the years and he bought both the TV's and is hoping mad at the thought of anyone touching his stuff. All the furniture has been bought by my father to kit us out in the home too, he will go ten shades of bat crazy if anyone touches these. Also my partners cars could be at risk on the driveway, can they not?
  • Minkym00Minkym00 Forumite
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    See here: https://www.citizensadvice.org.uk/debt-and-money/debt-solutions/bankruptcy-2/after-you-go-bankrupt/creditors-still-chasing-you-after-you-go-bankrupt/

    Get the bankruptcy order before they get a liability order! They won’t be able to enforce it after the bankruptcy, but will if they get it before you get your bankruptcy order.
  • PMS78PMS78 Forumite
    14 Posts
    What about my SOA? Is that ok? Am I too high on anything?
  • sourcratessourcrates Forumite, Board Guide
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    PMS78 wrote: »
    What about my SOA? Is that ok? Am I too high on anything?


    I think you could easily up some of those figures, i think the OR works off a standard financial statement, but i`m unsure of the allowences for each catagory, however the Gardener will know or Fatbelly, if either of them pick up this thread.


    You only get an IPA if you have £20 or more disposable income.
    I'm a Board Guide on the Debt-Free Wannabe, Credit File and Ratings, Bankruptcy And Living With It, boards. "I volunteer to help get your forum questions answered and keep the forum running smoothly".
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    Any views expressed are mine and not the official line of MoneySavingExpert.com.
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  • edited 1 September 2019 at 2:47PM
    fatbellyfatbelly Forumite
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    edited 1 September 2019 at 2:47PM
    Minkym00 wrote: »
    See here: https://www.citizensadvice.org.uk/debt-and-money/debt-solutions/bankruptcy-2/after-you-go-bankrupt/creditors-still-chasing-you-after-you-go-bankrupt/

    Get the bankruptcy order before they get a liability order! They won’t be able to enforce it after the bankruptcy, but will if they get it before you get your bankruptcy order.

    This crops up from time to time. See here for discussion on why this is not an issue in practice.

    https://forums.moneysavingexpert.com/showthread.php?t=5831828
    i think the OR works off a standard financial statement, but i`m unsure of the allowences for each catagory, however the Gardener will know or Fatbelly, if either of them pick up this thread

    I can have a look for you tomorrow. I wouldn't deliberately lower your wage at this stage (but check you are making sensible pension contributions).
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