Your browser isn't supported
It looks like you're using an old web browser. To get the most out of the site and to ensure guides display correctly, we suggest upgrading your browser now. Download the latest:

Welcome to the MSE Forums

We're home to a fantastic community of MoneySavers but anyone can post. Please exercise caution & report spam, illegal, offensive or libellous posts/messages: click "report" or email forumteam@.

Search
  • FIRST POST
    • sav1876
    • By sav1876 12th Oct 18, 9:56 PM
    • 5Posts
    • 0Thanks
    sav1876
    Trustee charges and procedures
    • #1
    • 12th Oct 18, 9:56 PM
    Trustee charges and procedures 12th Oct 18 at 9:56 PM
    Hi all,

    First time poster looking for some advice please.

    Iíll give a bit of background.

    My father in law has been in poor health in recent years and has struggled with alcoholism. He received a letter from his mortgage lender saying the house was being repossessed due to a large amount of arrears. He decided to sell the house as he had about 30,000 in equity left which would have been enough to see him through to retirement in 3 years time.

    A week before the sale went through he received a letter from a Trustee saying he had been made bankrupt back in January. This held up the sale by 6 weeks. It finally went through today.

    He phoned the trustee today who informed him it would be months before he received any money. He is currently staying with my wife and I, and was incredibly frustrated at hearing this. He went to citizens advice today with my wife where he was told that the trustees could hold the money for 3 years and that he may not receive any money at all.

    We think he would be left with 20,000 after the debt is paid, however we do not know how much the trustee will charge in fees. He has 3 debts in addition to the mortgage lender and estate agent, these are 2 accounts with Lowell and council tax.

    Is it possible the trustee charges could wipe this out? Do they have an obligation to pay him anything? Can anyone give a rough indication of how long this could take?

    Many thanks,

    S
Page 1
    • luvchocolate
    • By luvchocolate 13th Oct 18, 8:50 AM
    • 1,685 Posts
    • 1,519 Thanks
    luvchocolate
    • #2
    • 13th Oct 18, 8:50 AM
    • #2
    • 13th Oct 18, 8:50 AM
    Hi please bear in mind my B.R was 6 years ago so costs may be more now.
    My trustee charged £144.37 per hour....the total cost was £21,047
    • Flyright
    • By Flyright 13th Oct 18, 10:19 AM
    • 343 Posts
    • 195 Thanks
    Flyright
    • #3
    • 13th Oct 18, 10:19 AM
    • #3
    • 13th Oct 18, 10:19 AM
    This not only depends on the level of fees charged by the trustees but also how much all the debts add up to as all debts will need to be cleared along with the trustees fees.
    • xFlake
    • By xFlake 13th Oct 18, 12:31 PM
    • 83 Posts
    • 44 Thanks
    xFlake
    • #4
    • 13th Oct 18, 12:31 PM
    • #4
    • 13th Oct 18, 12:31 PM
    Hello sav1876,

    It depends who is trustee. If it is the OR then there is some certainty over fee's which are just shy of £9,000 plus a percentage of each asset. If it is a private sector IP trustee (basically not the OR) then the fee's will be substantially more. It sounds to me there is a IP trustee in place.

    Sorry to bare bad news, but I would estimate from the above figures that there would be likely be nothing left after fee's.
    • sav1876
    • By sav1876 13th Oct 18, 7:59 PM
    • 5 Posts
    • 0 Thanks
    sav1876
    • #5
    • 13th Oct 18, 7:59 PM
    • #5
    • 13th Oct 18, 7:59 PM
    Thanks for that folks. He's going into citizens advice next week to see what the best steps forward are. Pretty galling that a disputed £3,000 council tax bill has ended up costing him everything.
    • Flyright
    • By Flyright 13th Oct 18, 8:42 PM
    • 343 Posts
    • 195 Thanks
    Flyright
    • #6
    • 13th Oct 18, 8:42 PM
    • #6
    • 13th Oct 18, 8:42 PM
    I'm not sure what Citizens Advice are going to be able to tell him. He is bankrupt and the trustees are realising an asset as they are entitled to do.
    • sav1876
    • By sav1876 13th Oct 18, 9:47 PM
    • 5 Posts
    • 0 Thanks
    sav1876
    • #7
    • 13th Oct 18, 9:47 PM
    • #7
    • 13th Oct 18, 9:47 PM
    He's going to see them regarding housing, its quite a complicated situation he is in. We think its probably best speaking to them first to get clarification on a few things before making the next step.
    • PrettyKittyKat
    • By PrettyKittyKat 14th Oct 18, 6:52 PM
    • 935 Posts
    • 901 Thanks
    PrettyKittyKat
    • #8
    • 14th Oct 18, 6:52 PM
    • #8
    • 14th Oct 18, 6:52 PM
    Did your father in law not realise a petition for his bankruptcy had been made back in January? I would presume he has received contact in the form of letters and calls in the time running up to and after this.
    • lyncom
    • By lyncom 18th Oct 18, 11:36 AM
    • 2 Posts
    • 0 Thanks
    lyncom
    • #9
    • 18th Oct 18, 11:36 AM
    OR fees
    • #9
    • 18th Oct 18, 11:36 AM
    Although the OR charge a general fee this is far too high when people can afford to pay the debts in full but not the spiralling costs from the OR for the little amount of work they do. This should be challenged
    • Flyright
    • By Flyright 18th Oct 18, 1:20 PM
    • 343 Posts
    • 195 Thanks
    Flyright
    I think you will find that the OR's costs pale in comparison to private sector IP's and in any case the OR's fees are needed when you consider how few bankruptcies have sufficient assets to be able to fund the OR's functions.
    • lyncom
    • By lyncom 18th Oct 18, 3:31 PM
    • 2 Posts
    • 0 Thanks
    lyncom
    The OR already receives a fee from the petitioner on the making of a bankruptcy order in the sum of £2775.00 for the performance of his duties so regardless of whether there are assets, the OR receives payment. It is the general fee of £6k that I believe is far too high.
    • Flyright
    • By Flyright 18th Oct 18, 4:27 PM
    • 343 Posts
    • 195 Thanks
    Flyright
    The OR does not receive a fee of £2775 from the petitioner on the making of a bankruptcy order.

    The OR only gets a petitioners fee of £990 when a creditor petitions. £2775 is a creditors petition administration fee and is only recovered from the realisation of assets and creditors do not have to pay this money upfront.

    It is only collected if and when assets are realised.
    Last edited by Flyright; 18-10-2018 at 4:48 PM.
Welcome to our new Forum!

Our aim is to save you money quickly and easily. We hope you like it!

Forum Team Contact us

Live Stats

252Posts Today

1,203Users online

Martin's Twitter