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    • 927
    • By 927 6th Jul 18, 9:01 PM
    • 45Posts
    • 5Thanks
    927
    DMP or Bankruptcy??? I'm in a mess. Please help
    • #1
    • 6th Jul 18, 9:01 PM
    DMP or Bankruptcy??? I'm in a mess. Please help 6th Jul 18 at 9:01 PM
    I owe £27000 to Barclaycard, Halifax, Virgin and MBNA all credit cards and have no way of paying any of it. I have contacted stepchange, national debtline and citizens advice. SC advised bankruptcy. Citizens advice advised token payments. All the creditors want a dmp.

    My income is benefits and child support £1884 a month and my outgoings are £1862 a month. I do have a car which is worth approx £1200. I use this to take my child to nursery (and will also have to use it to take him to school) as we live in a rural area. My parents have offered to pay any excess if the OR took it as an asset. I rent privately.

    I just want this debt gone but don't see my situation improving dramatically. Really worried and anxious. When I contacted creditors today they all said they manage debts inhouse (not dca's) as I'd asked about full and final settlements as a relative said he could give me £12k but only for a f&f. All except virgin said they didn't accept them.

    Can someone please advise me, pros and cons?
Page 1
    • sourcrates
    • By sourcrates 6th Jul 18, 9:53 PM
    • 15,245 Posts
    • 14,344 Thanks
    sourcrates
    • #2
    • 6th Jul 18, 9:53 PM
    • #2
    • 6th Jul 18, 9:53 PM
    Hi,

    You seem to of thought this through pretty well, forget token payments, they are a waste of time, DMP, you do not have sufficient disposable income to do one.

    Bankruptcy is a big step, but not as costly as it once might of been, as long as it does not effect your employment you can pretty much carry on with normal life.

    One tip, make your budget show a surplus of less than £20 (close now) and you will not get an IPA.

    From what you have said it appears to be your best option, however, they are all non priority debts credit cards, you could ask them to write off the debts first, failing that you just need the £680 bankruptcy fee.
    I'm a Board Guide on the Debt-Free Wannabe, Credit File And Ratings, and
    Bankruptcy And Living With It, boards. "I volunteer to help get your forum questions answered and keep the forum running smoothly".
    Board guides are not moderators and don't read every post. If you spot an abusive or illegal post then please report it to forumteam@moneysavingexpert.com. Any views are mine and not the official line of MoneySavingExpert.com.

    For free debt advice, contact either : Stepchange, National Debtline, or, CAB.
    For Free Legal advice see : http://legalbeagles.info/
    • 927
    • By 927 6th Jul 18, 10:20 PM
    • 45 Posts
    • 5 Thanks
    927
    • #3
    • 6th Jul 18, 10:20 PM
    • #3
    • 6th Jul 18, 10:20 PM
    Thank you for reply. How do I increase expenditure on SOA - stupid question really but Iíve tried to budget a bit so it appears I will be able to live within my means. Iíve averaged 12 months of fuel and food and Iíve put £340 in for food. I anticipate fuel will go up a bit as my child will be going to nursery another day a week from September.

    Doesnít the OR go through all my bank statements and cc (barclaycard is the only used for purchases) to see what Iíve spent and then once Iím bankrupt to check my expenditure? Bit concerned car wonít be classed as exempt too.

    I contacted all four creditors today to offer full and finals and Halifax said they donít ever do them, Barclaycard the same. MBNA said write in and Virgin said they may consider it but only if my credit file showed defaults. I have only defaulted on one card (theirs) this month-the other accounts are on hold until 23rd July. I stressed on the phone that I have no money to pay them and my only other option was to consider bankruptcy.
    • Karonher
    • By Karonher 6th Jul 18, 10:56 PM
    • 512 Posts
    • 2,158 Thanks
    Karonher
    • #4
    • 6th Jul 18, 10:56 PM
    • #4
    • 6th Jul 18, 10:56 PM
    If it is just you and a child I would doubt you will get away with putting £340 in. Having read other threads on the site it seems to be around £220 for an adult and less for a child so it could depend on the age and it seems yours is very young. You would probably have to fill in an expenditure sheet, so it could depend on what you are spending the rest of the money on.
    Getting ready for Christmas 2018

    Aiming to make £5,000 online in 2018.
    • 927
    • By 927 6th Jul 18, 11:01 PM
    • 45 Posts
    • 5 Thanks
    927
    • #5
    • 6th Jul 18, 11:01 PM
    • #5
    • 6th Jul 18, 11:01 PM
    Iíd read the same for adult with £115 for child. Canít remember where though.
    • 927
    • By 927 6th Jul 18, 11:26 PM
    • 45 Posts
    • 5 Thanks
    927
    • #6
    • 6th Jul 18, 11:26 PM
    • #6
    • 6th Jul 18, 11:26 PM
    Pressed post too soon!
    Rent is 850
    Utilities is £113
    Mobile 20
    Bband 25
    Car fuel 90
    Tax 17.60
    Insurance 38
    Mot and servicing 15
    Toiletries 20
    Swimming lessons (child) 60
    Parking 5
    Laundry 5
    Smoking 5
    Alcohol 5
    Pension 20
    Contents ins 8
    Emergency 20
    Haircuts 15
    Opticians and dentist 36
    Tv licence 12.47
    Groceries 340
    Clothing 45
    Gifts 15
    Child dentist 8
    Leisure 20

    The reason Iíve filled all these in is because I thought the SOA is meant to be what actual spending is now?? I understand some things may go up or down.
    • fatbelly
    • By fatbelly 7th Jul 18, 6:20 AM
    • 12,678 Posts
    • 9,751 Thanks
    fatbelly
    • #7
    • 7th Jul 18, 6:20 AM
    • #7
    • 7th Jul 18, 6:20 AM
    That all looks ok to me.

    Where did you get your car valuation from? Try parkers guide - poor condition. Ideally you want a value of less than £1000
    • 927
    • By 927 7th Jul 18, 12:49 PM
    • 45 Posts
    • 5 Thanks
    927
    • #8
    • 7th Jul 18, 12:49 PM
    • #8
    • 7th Jul 18, 12:49 PM
    I did get a valuation from Parkerís, autotrader and took it into a dealership. I couldnít find a way for Parkerís to quote me poor condition except for private sale which comes out as £840. It is in poor condition. Dealership said they wouldnít touch it and £800 and autotrader for fair condition £1410. Do I use Parkerís poor condition private sale price?
    • fatbelly
    • By fatbelly 7th Jul 18, 1:30 PM
    • 12,678 Posts
    • 9,751 Thanks
    fatbelly
    • #9
    • 7th Jul 18, 1:30 PM
    • #9
    • 7th Jul 18, 1:30 PM
    I did get a valuation from Parker!!!8217;s, autotrader and took it into a dealership. I couldn!!!8217;t find a way for Parker!!!8217;s to quote me poor condition except for private sale which comes out as £840. It is in poor condition. Dealership said they wouldn!!!8217;t touch it and £800 and autotrader for fair condition £1410. Do I use Parker!!!8217;s poor condition private sale price?
    Originally posted by 927
    Parkers gives values as follows

    Franchised Dealer:
    Independent Dealer:
    Private Good:
    Private Poor:
    Part Exchange:

    The one I use when valuing a car for a DRO application is Private Poor. If it's saying £840 for your car, save or print that page and put that as your valuation on your bankruptcy application.
    • Sncjw
    • By Sncjw 7th Jul 18, 1:42 PM
    • 1,916 Posts
    • 1,125 Thanks
    Sncjw
    Why not fill in a soa. Also why are you paying for your child to see the dentist. It!!!8217;s free for children
    • 927
    • By 927 7th Jul 18, 2:51 PM
    • 45 Posts
    • 5 Thanks
    927
    Thank you - the car has heaps wrong with it, electrics, air con doesnít work etc. Fine for me doing run around a bit resale not so good. Iíll use the private poor value. Thanks so much.
    • 927
    • By 927 7th Jul 18, 2:56 PM
    • 45 Posts
    • 5 Thanks
    927
    Hi, I have done an soa and Iíve also completed the bankruptcy forms online which have different categories. What Iíve posted is the list from there. Iíve put everything in including dentistry because thatís what I paid last year for him. Iíd assumed the OR would flag it if not allowed?
    • 927
    • By 927 7th Jul 18, 3:08 PM
    • 45 Posts
    • 5 Thanks
    927
    Iíve also used the Stepchange budget guidelines from 2012 as a sort of marker.
    • fatbelly
    • By fatbelly 7th Jul 18, 5:01 PM
    • 12,678 Posts
    • 9,751 Thanks
    fatbelly
    Everyone has to use the standard financial statement guidelines now - they are pretty generous but hard to follow in practice.

    They are also kept secret but I roughly know the figures for 1 adult 1 young child 1 car. I'm sure those figures you posted will be OK
    • Clouds88
    • By Clouds88 8th Jul 18, 8:05 PM
    • 57 Posts
    • 25 Thanks
    Clouds88
    60 swimming a month probably wonít go down well? Maybe you miss typed and meant to be 20?

    Also if you are on benefits arenít dentist prescriptions ect free? Just trying to flag up stuff now so if you go in with figures for the OR and he calls you up on it you would have an IPA try to think of other things you might need. I donít smoke or drink alcohol but do they actually give you an allowance for that? Why not change that it to presents seeing as you have a little one.
    • 927
    • By 927 9th Jul 18, 12:20 PM
    • 45 Posts
    • 5 Thanks
    927
    No - that is what his swimming costs and thatís the only thing he does (heís nearly 4) that I pay for. We donít do days out to places unless theyíre free. Iíve put £15 in a month for presents (under gifts). Yes, I get prescriptions for free as I get income support. Not that we have a lot of them. I do smoke - and rarely drink but maybe once every couple of months Iíll buy a beer or wine so Iíve put £5. If itís taken out then itís not something Iíll be distraught about. Most important is food, utilities and car really.

    Does the OR have bank statements and bills in front of them when you have your interview? To try and budget better I take cash out and use rather than use my debit card (leave that at home in a drawer) so will that be queried?
    • Clouds88
    • By Clouds88 9th Jul 18, 3:06 PM
    • 57 Posts
    • 25 Thanks
    Clouds88
    No they donít go through your bank statements, some ask for example six months worth of statements sent to them, others wonít.

    They will just go through an income and expenditure with you on the phone and query anything that they either wonít accept/think is too high/too low.

    The best thing to do is just be honest and bite the bullet and go for it, once youíve done it youíll feel so much better.
    • 927
    • By 927 9th Jul 18, 4:14 PM
    • 45 Posts
    • 5 Thanks
    927
    Itís hard to know how much some things cost or rather how much I spend on specific things. Iíve got records of food for example but gifts I havenít. Likewise toiletries so Iíve had to do a bit of guesswork sometimes. Iím wary of over estimating AND underestimating. I guess thatís the problem with credit - it allows you to spend what isnít there already. Feel like such an idiot when I look at the debt.
    • sourcrates
    • By sourcrates 9th Jul 18, 5:14 PM
    • 15,245 Posts
    • 14,344 Thanks
    sourcrates
    Itís hard to know how much some things cost or rather how much I spend on specific things. Iíve got records of food for example but gifts I havenít. Likewise toiletries so Iíve had to do a bit of guesswork sometimes. Iím wary of over estimating AND underestimating. I guess thatís the problem with credit - it allows you to spend what isnít there already. Feel like such an idiot when I look at the debt.
    Originally posted by 927

    This is why you need to talk to a specialist debt advisor, either at stepchange or National Debt-line, they will run through your budget, tell you the maximum allowances for each category in Bankruptcy so you won`t have to guess.


    You would not recognize a budget sheet prepared for an insolvent, as everything is grouped together into about 2 to 3 categories for simplicity.
    I'm a Board Guide on the Debt-Free Wannabe, Credit File And Ratings, and
    Bankruptcy And Living With It, boards. "I volunteer to help get your forum questions answered and keep the forum running smoothly".
    Board guides are not moderators and don't read every post. If you spot an abusive or illegal post then please report it to forumteam@moneysavingexpert.com. Any views are mine and not the official line of MoneySavingExpert.com.

    For free debt advice, contact either : Stepchange, National Debtline, or, CAB.
    For Free Legal advice see : http://legalbeagles.info/
    • 927
    • By 927 9th Jul 18, 5:41 PM
    • 45 Posts
    • 5 Thanks
    927
    I have run through it with Stepchange and they didn!!!8217;t give me any info on maximum allowances. Maybe I should call them again to discuss.

    Can anyone advise re car? If I sell for market value to use funds to pay for bankruptcy application will this be frowned upon? My parents have said they!!!8217;ll pay market price so I can still use a vehicle.
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