Filing for bankruptcy

[rosiecotton]

I have thought this all through a lot and I have now decided that filing for bankruptcy will be my only way out of an old debt which has now got out of control.

I owe c. £23k now after a bad marriage and divorce several years ago, and my circumstances are now such that I can only pay £58 a month to my five creditors instead of the £475+ that they require as a minimum payment. I do not see this changing.

I have checked and bankruptcy will not affect my job, though I am supposed to have a bank account to pay my salary into. I guess I will need to ask my current bank (to whom I do not owe a penny) whether they would consider still offering me a basic account.

I have checked my tenancy agreement and can see no mention of CCJs or bankruptcy, but have contacted the letting agent today regarding this as the last thing I want is to lose my home as me and my fiance would have nowhere to go. I have never missed a rental payment and all my priority bills are paid up to date.

What else do I have to do before taking steps to file the petition? Do I need to get further advice or can I just go ahead and start proceedings myself?

Incidentally I have spoken in the past to CCCS but I didn't find them all that helpful as they ignored several of my emails and didn't help answer my questions, so I was a little critical of them in feedback (albeit in a polite way) but I am still scared to go back to them!

Also where on Earth am I going to get the £370 from that I understand it costs in court and Official Receivers' fees?! I can hardly ask my bank for a loan to go bankrupt with I guess I could borrow the court fees from my parents but they won't have the full £370 lying around.

What will they take when I go bankrupt? The only real asset I have is my car, which is worth about £2k, but I need a car for my work. Apart from that I have a PC at home which I also use for work, but no other gadgets as such other than a cheap 5 year old Bush TV, a 10 year old video recorder and a 7 year old DVD player.

This is quite a big deal for me and I want to make sure that I've thought of everything and nothing will go horribly wrong...

I just want to have some form of quality of life, I am tired of living like a hermit, eating spaghetti hoops every night and wearing clothes to work that have holes in

[gizmo111]

Have a read here http://www.consumeractiongroup.co.uk...ling-debt.html

Try the nationwide or co-op for a bank account. Your accounts at predent wil lbe frozen and it is highly unlikely that the same bank will fofer you an account.
You need to open the new account after BR so on your way out of court not you way in.
Plan the dates you go BR, a few days after payday is good as you then have time to transfer all your I&E to a new account, and also make sure that you have taken out any cash in the old account, before the BR.
Basically you need to save for the fees (bizarre I know) - so stop paying the creditors for a start and then cut back as much as you can. If you have a credit card or overdraft that has not reached it's maximum and you can still use then draw the cash out from there to pay for your BR, many people have done this and the OR is absolutely fine about it.

[rosiecotton]

Thanks for that.

I was quite concerned that they'd declare me bankrupt and freeze my account, taking my salary for that month which I need to pay the rent and priority bills and thus causing more ongoing problems!

I think with my debts of £23k and no real way to pay them off, there's no alternative for me.

It'll take me a horrifically long time to save up the court fees though, so maybe I will scrounge a loan from family or friends - not ideal but I don't have any current "live" credit cards or active bank accounts with overdrafts, so I don't have that option.

Mind you, I could probably get an overdraft on my current bank account as they have offered it when I switched, but it would seem a bit tight to get the overdraft, take the money and then add them to the list of creditors...

[lazybones]

Originally Posted by rosiecotton

Thanks for that.

I was quite concerned that they'd declare me bankrupt and freeze my account, taking my salary for that month which I need to pay the rent and priority bills and thus causing more ongoing problems!

I think with my debts of £23k and no real way to pay them off, there's no alternative for me.

It'll take me a horrifically long time to save up the court fees though, so maybe I will scrounge a loan from family or friends - not ideal but I don't have any current "live" credit cards or active bank accounts with overdrafts, so I don't have that option.

Mind you, I could probably get an overdraft on my current bank account as they have offered it when I switched, but it would seem a bit tight to get the overdraft, take the money and then add them to the list of creditors...

Hi Rosie

Looks like I'm in the same sort of boat as you.
£24.5k in debt and only just over £180 amonth to pay them off, work it out, and it'll take 11 years to pay. That's if everybody stop all charges and interest (some hope!).

Anyway sorry to hear your troubles and hope you get sorted.
Best of Luck whatever you decide to do.

[sequenci]

You will need the permission of the OR to open a new bank account when you go bankrupt, otherwise it will end up being part of the estate with the likelyhood of being frozen.

The fees for bankruptcy are £325 for the OR and £150 for the court, if you are on a low income you may be able to get court fee exemption.

You might be able to get help with the fees, you could try and see if any of your utility firms have a trust fund (most do such as British Gas & EDF energy) or you could try the Association of Charity Officers (01707 651 777) who might be able to find funding for you.

The only asset to be concerned about is the car, they may tell you to sell it with a view to getting a cheaper one. You'll need to argue your cause with the OR. They wont bother with things like PCs or electricals, they do not get much at auction + they have to be tested to be safe and have the data removed (pcs).

If CCCS are not helpful, try National Debtline on 0808 808 4000 or take a look at their factsheet:

National Debtline England & Wales | Debt Advice | Factsheet 01 Bankruptcy

You can also have a look around the insolvency service website:

The Insolvency Service Website

If you are working you may be asked to pay something from your surplus income for 3 years (usually between 50-66%), although with a surplus like yours they shouldn't do this.

Usually people are discharged from bankruptcy well within 12 months.

[sequenci]

Originally Posted by lazybones

£24.5k in debt and only just over £100 amonth to pay them off, work it out, and it'll take 20 yesra to pay. That's if everybody stop all charges and interest (some hope!).

you could qualify for a Debt Management Plan (Free with Payplan/CCCS), they have a very high success rate in freezing interest and charges for people.

[Glenn UK]

Id also suggest trying Payplan I used them for a DMP and i found them good. not the same as bankruptcy i know but it could be worht a call.

Best of luck, there but for the grace of god

Glenn

[lazybones]

Thanks for advice sequenci
Will start own thread on debt soon, don't want to hi-jack Rosie's
Do you think a short out line on how I got into debt to start with is a good idea?

[sequenci]

Originally Posted by lazybones

Thanks for advice sequenci
Will start own thread on debt soon, don't want to hi-jack Rosie's
Do you think a short out line on how I got into debt to start with is a good idea?

only if you fancy giving yourself an intro, you don't *have* to.

[Gingerheid]

You will find the ORs staff helpful about bank accounts; when you speak to them on the phone from the court they should ask about this and arrange to send a letter to the bank saying they don't want your salary.

Nationwide are very good, but if they happen to be a creditor in your bankruptcy they are a bad choice! Other good choices are the Co-Op and Barclays.

If your car is only worth £2000 as you say it will be fine; but you will need to be able to show that you need it for work (as opposed to like it for work). You can check the value on parkers.co.uk if you haven't already.

Your letting agency shouldn't have a problem; they should realise that bankruptcy will put you in a better position to meet the payments than you were before.

[rosiecotton]

Nationwide are indeed one of my creditors, and have been one of the more difficult ones.

I'll try the Co-op, when the time comes.

Parkers actually quote my car as being about £1700 max, so hopefully I may get to cling on to that one and save the hassle of finding an even crappier old banger. It's in my terms and conditions at work that I have a car as I am needed to travel around the county, so no problems proving that.

Thanks for all your help. I will start the ball rolling this weekend.