Bankruptcy questions
Kimberley
Posts: 14,871 Forumite
Hi all
Can you help with the following. I’m struggling with paying my debts. I work one rest day a week which just covers the CC minimum repayments I have each month.
My questions are
How does the OR work out your income if you do not get the same amount each week? My hours and pay are different week to week.
Do I have to give up a mobile contract and be forced to go pay as you go? What happens to the phone i’m paying for on my contract?
Do I have to go on a key meter for gas and electric or are the fuel companies not told about any banruptcy?
Do i include details of my adult children living with me even if they are not dependant on me?
How much do they allow you to live on?
I belong to a bus preservation group and own my own bus. The bus is only worth scrap value but I spend £150 a month on storage fees for it? TAX and MOT etc. This is my hobby and all I have. Will I be allowed to keep it?
Can you help with the following. I’m struggling with paying my debts. I work one rest day a week which just covers the CC minimum repayments I have each month.
My questions are
How does the OR work out your income if you do not get the same amount each week? My hours and pay are different week to week.
Do I have to give up a mobile contract and be forced to go pay as you go? What happens to the phone i’m paying for on my contract?
Do I have to go on a key meter for gas and electric or are the fuel companies not told about any banruptcy?
Do i include details of my adult children living with me even if they are not dependant on me?
How much do they allow you to live on?
I belong to a bus preservation group and own my own bus. The bus is only worth scrap value but I spend £150 a month on storage fees for it? TAX and MOT etc. This is my hobby and all I have. Will I be allowed to keep it?
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Comments
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The bus is an asset that has to be dealt with by the OR so will likely be taken.0
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My OR told me to 'average out my income'. No further details so I took 3 months and averaged it. I guess you could do the same or take a year and average it out. Just don't lie!
Phone: If you are already on a contract no credit checks will need to be done so I assume it will continue. Unless you are in debt to the phone company they won't be informed of your situation. Of course, if the contract is for £100 or something crazy per month I doubt the OR will allow it in your expenses.
Energy: Same as phone. if you move house or change company, there might be an issue though as at this point credit checks will be done.
Children: I'm not sure how adult children are categorised, however if they contribute to the household expenses then that will need to be factored in to your income and expenditure. Someone else might be better placed to answer that.
How much do they give you to live on? Well.. how long is a piece of string. You tell them your household situation, how much you 'need', and they say yes or no. Have a look at some example SOAs on the forum and ask any specific questions after posting up your SOA. The OR is quite reasonable from what I have experienced, however there isn't a public list of acceptable limits by category unfortunately.
Bus: As it is a motor vehicle I'm afraid it will have to be included in the bankruptcy and ownership would transfer to the OR automatically. You have some choices here:
1) Prior to bankruptcy, sell it (to a friend... shhhh!) **FOR THE GOING MARKET RATE**. An independent valuation in advance would help the OR believe you're not doing anything dodgy. Your friend can then transfer it back to you after bankruptcy. If the money paid is significant you should ideally spend it sensibly e.g. on bills, living costs, bankruptcy fee, servicing debt etc.
2) Include it in the bankruptcy and see what the OR does with it. There is a chance they may auction or scrap it. Remember it belongs to them. However, more likely is they will allow you to buy it back with the money of a friend as this will cost them less. This is what happened to my rustbucket. A guy from the local auction house showed up the week after my bankruptcy, valued my car and allowed me to purchase it with a friends' cash. He then wrote on the receipt that it was immediately gifted back to me by my friend so the V5 didn't have to be sent off.
Bus storage and running costs would not be allowed by the OR* and would have to be funded by someone else or by savings in other areas (e.g. you put £500/month for food and only spend £350).
*Unless perhaps you had 100-odd children to take to school every day!0 -
Hi and Welcome. To answer your questions:
The OR will most likely work out your average income over 12 months and base their calculations on that.
No - you are not forced to go on PAYG - if your contract is upto date and you can afford to keep paying it then that's what you do -if the contract is a 'luxury' one with a gold plated iPhone and costs £70 odd quid a month - it may be questioned.
No - you do not have to go onto a meter if your utility bills are up to date. However, if you are in arrears with your utilities and debts to them are to be included in the BR then those companies may ask you to either pay an upfront deposit or have a PAYG meter.
The OR will expect all adults to contribute to the household costs and will not allow you to support them financially unless they are dependant on you (elderly, disabled etc)
Living costs are individual and if you look at any of the SOA posts on this board it will give you an idea of the sort of costs the OR would find reasonable. You are not expected to live in abject poverty.
The Bus - The OR may not be interested in the bus if there is no real value to it - probably best to 'donate' it to the group maybe? However, its highly unlikely the OR will entertain £150 for a 'hobby' but based on your other living costs - you might be able to save on other things you have budgeted for to cover some of the costs.0 -
Thanks guys. What do you mean by averaging out your income? Also what if your daughter lives with you and her child and can’t afford to contribute? Do they request financial info from the adults in your home?
I work a rest day each week that just covers the minimum payments on my CC’s
If I don’t work a rest day then i cannot pay the CC’s at all on my basic wage. Also how does the OR work out your income when my hours and pay differ from week to week?0 -
If your pay varies each week then to get an average income - the OR would take all your payslips for say 12 months - add them up then divide by 12 to give your average income.
The OR may ask for supporting evidence of income from your partner but they are not obliged to give it. But if a partner earns about the same or less than you it is worth giving the OR the info they ask for.
Your daughter and her child are not your financial responsibility - your daughter should be paying for her and her daughters expenses including contribution to the rent/food/bills etc. and this is what the OR would quite rightly expect.
If you make the decision to go BR - stop paying all unsecured debts like CCs to save for the BR fees. However, you should continue to pay essential things like rent, council tax and utilities.
You should seek free professional advice from Stepchange, National Debtline or CAB if your local one has expertise in debt and BR.0 -
Thank you. Just one more question. Does the OR check your bank statements each month to check what you put down on your SOA is the correct amount? Like say for example, I put down i spend £210 a month on food/toiletries/packed lunches and one month I spend £30 less then I said. Do they then say, that £30 can go towards an IPA?0
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Hi the O.R will want to see your bank statements 12/24 months but really as far back as they want.
They do not monitor your bank accounts after B.R although if they think there is anything dodgy going on they can do.
Its common to use money within your approved S.O.A for other things this is fine.
The important thing is to get your S.O.A right, we can help you with that, put it up here and we can advice.
May I also suggest you read all the stickies at the top of the page including the welcome thread.
I also found the Insolvency Service site worth reading.
Make sure you have a basic bank account up and running.
If you are prepared the whole process will be easier.0 -
http://www.stoozing.com/calculator/soa.php
click here to get started on your SOA, once completed go near the bottom of the page, there is a section called "Format results for discussion boards ", just click the "MSE" tab and you will be ready to post on here
We can then all help further with regards to what amounts you can put in as reasonable expenses
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Thank you. I will do that later after work.0
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How do i copy and paste my SOA from that link above0
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