Bankruptcy advice and questions

[geministar2007]

I am about to apply for bankruptcy and have a couple of questions.

 

Firstly i am on a DMP with Payplan currently paying £25 per week, what is the likelihood of this being helf while i file for bankruptcy, the money i am paying to that i need to pay for the bankruptcy. Also seems ridiculous throwing money away that is going to be wipped via bankruptcy.

 

Secondly, when i started my DMP i had to open a basic bank account, which i did, a Lloyds cash card account, no overdraft. Do i have to open another basic account? As i am aware bank accounts get frozen.

 

Thirdly, i do not have all my bank statements and so on, i keep each new months as they come in and throw the old ones away. Is this a problem?

 

Fourthly, can anyone advise me anything else regarding the bankruptcy process i am nervous however can no longer go on paying back my debts, when creditors still charge interest i have tried! Which i am hoping goes in my favour!

 

Thanks :)

[huggys boss]

subscribing

[phat256]

hi geministart i am BR since July and i was more or less in the same situation i was mainly repaying interest and charges and that it.

 

 

regarding your DMP you can choose to stop paying them but be warned they may start ringign u up and sending you threatening letter, even go for a CCJ, until you file for bankruptcy. Myself i had to stop paying all my creditor before i filed for BR.

 

Secondly you will need to take advice form the antional debtline CCCS befoer you fiel for BR as the District judge will ask you this and if you haven't he can withhold or refuse your BR order until you have done so !

 

Regarding Bank account , well once you are declared BR all your asset are no longer yours which mean the OR will ask you to give back all credit and debit card cheque book bank account etc.....then there is two bank who accept undischarge BR barclays and the Co Op ( there is a rumour that they will accept you if u don't owe them any money see money saving expert Br board). you can open a basic account with them before your BR order but the OR will have to fax them a letter saying he has no interest in them as they may get frozen.

 

However i have been advise by National debtlien to open a Bank account after my BR order as it will be mine and not under the OR control.

 

Before my BR i was with halifax , i had only a basic account no overdraft no cheque book it got frozen and then close by the bank , they were not one of my creditor. i had succesfully open a Bank Account with Barclays.

 

You will have also make provision for you to have enough money to pay for your food, your bill by giro if possible , rent etc...

 

Regarding your bank statement don't worry about it . the OR can get them for free and more quickly than you. you will have to say to your OR that you have lost them and sent what you have got. Myself i have lsot a lot of CCA for my loand and CC but the OR had already all info in hand .

 

but before you take any drastic decison took advise from the CAB, CCCS or National Debtline .

 

the Br process is relatively quick what i found it is the decison to declare yourself BR the loongest to take ! my order took 2 hours form start to finsih, the hearing lasted 10 minutes.

[gizmo111]

I am about to apply for bankruptcy and have a couple of questions.

 

Firstly i am on a DMP with Payplan currently paying £25 per week, what is the likelihood of this being helf while i file for bankruptcy, the money i am paying to that i need to pay for the bankruptcy. Also seems ridiculous throwing money away that is going to be wipped via bankruptcy.

 

Stop paying this and use the money to save up for the BR fees. The creditors will probably start harassing you with calls and letters, but just tel lthem you are planning ot BR and will be in touch in due course.

 

Secondly, when i started my DMP i had to open a basic bank account, which i did, a Lloyds cash card account, no overdraft. Do i have to open another basic account? As i am aware bank accounts get frozen.

 

Thirdly, i do not have all my bank statements and so on, i keep each new months as they come in and throw the old ones away. Is this a problem?

 

You will most likely have to open a new account after BR. Most people do this when they leave the court. That way it is guaranteed that nothing will get frozen. Draw out in cash any money for living expenses in your account as well as the BR fees.

Don't worry about statements, just take what you have with you. The OR can request any more he may need direct from the banks.

 

Fourthly, can anyone advise me anything else regarding the bankruptcy process i am nervous however can no longer go on paying back my debts, when creditors still charge interest i have tried! Which i am hoping goes in my favour!

 

Have a read here.

What is it you hope will go in your favour?

[geministar2007]

thank you for your advice.

 

I meant i have hoped that the judge will not frown upon me so much as i have tried to pay my debts back, the reason i went with a DMP was to pay back what i owe, but what is the point if interest still occuring?

 

can someone explain what happens on the day, i have appointment for 5th Nov, i take my forms and money... then what? Do i see the judge that day? (i know someone who didnt have to see the judge), i then go home and the OR calls me, what does he/she say, how long does that take? I read somewhere that they may request to see you?

[42man]

The OR will ask to see you and normally make an appointment within 2 weeks of your BR order....then when you go to your interview they will give you a big folder to fill out full of questions about your finances, why you think you are BR, they get you to fill in all the debts that you know about (they will ask you to put a big 'D' in a circle if you dispute any of the debts (excessive charges etc).....they will ask you to bring in all details of pensions, bank cards, cheque books, premium bonds, wage slips...they will also note your outgoings....(they aren't allowed to help you - but mine was very friendly and 'guided' me on certain points....

 

When you have filled in the book, they will take this from you then go through it verbally !! (remember what you wrote down !! - you won't get a copy of this).....

 

Have a read here too...

 

http://www.detini.gov.uk/cgi-bin/downutildoc?id=1733

[42man]

No need to be nervous....try and relax as best as you can

[fermi]

The OR will ask to see you and normally make an appointment within 2 weeks of your BR order....then when you go to your interview they will give you a big folder to fill out full of questions about your finances, why you think you are BR, they get you to fill in all the debts that you know about (they will ask you to put a big 'D' in a circle if you dispute any of the debts (excessive charges etc).....they will ask you to bring in all details of pensions, bank cards, cheque books, premium bonds, wage slips...they will also note your outgoings....(they aren't allowed to help you - but mine was very friendly and 'guided' me on certain points....

 

That is the procedure if you are made bankrupt by a creditor.

 

If you do it yourself then the OR should already have most of that information in the 'statement of affairs' that you submit to the court on the day.

 

Unless your case is very complicated then it is likely that any interview required will be by telephone, unless this is one of the very few courts where you pop along to see the OR on the day of the bankruptcy hearing (Liverpool is one......).

 

On the day you may see the judge or you may not. Some are happy to sign off the papers without seeing you, while some will want a brief chat to make sure that you know what you are doing and understand the consequences.

 

Most judges are very nice, understanding and genuinely wish you well in a 'fresh start'. The court staff are normally the same.

 

At most courts you will have a brief conversation by phone with the OR's office to confirm details and deal with any urgent matters.

 

After a few days you should receive a pack with information and some forms to sign and return. Most people will also have a letter with that to say what type of interview (if any) is required. Although you may be telephoned separately to set that up.

 

The prospect of it all seems very scary before you do it, but the reality isn't as you imagine. I couldn't begin to count the number of people I've heard say that "they shouldn't have worried".

 

Good luck.

[42man]

Thanks Fermi....much appreciated...

[netmot]

I have a question if you don't mind answering. Are there any assets the OR will allow you to keep whether it was purchased recently or not? i.e clothes, electrical equipment, safe, computer equiptment etc?

 

Is there a definitive list somewhere?

 

Regards

[gizmo111]

I have a question if you don't mind answering. Are there any assets the OR will allow you to keep whether it was purchased recently or not? i.e clothes, electrical equipment, safe, computer equiptment etc?

 

Is there a definitive list somewhere?

 

Regards

 

There is no definitive list, but the OR is not interested in your personal things unless they have a significant resale value. He would not be interested in your clothes and household electrical items, but for example if you have a valuable electric guitar, or persian rugs he will be interested in them.

Are there particular items you are worried about?

[netmot]

Thanks gizmo111,

 

A computer purchased 12 months ago for £1,700, a car with a sale value of approx £4,500 (worth more to me) and a few very recent purchases around the £100 - £150 mark.

 

I suppose my question was/is, will puchases be seen as taking money out of my bank account to avoid the OR/trustees?

 

What is classed as avoidence or laundering?

 

Regards

[gizmo111]

Thanks gizmo111,

 

A computer purchased 12 months ago for £1,700, a car with a sale value of approx £4,500 (worth more to me) and a few very recent purchases around the £100 - £150 mark.

 

I suppose my question was/is, will puchases be seen as taking money out of my bank account to avoid the OR/trustees?

 

What is classed as avoidence or laundering?

 

Regards

 

The car will go I'm afraid. Do you need a car for work? If so you will be given back an amount from the sale of around £2k to replace it.

No they are old purchases - the OR wouldn't like it if for example you booked a holiday knowing you were going BR the next month.

You'll be Ok on the rest I think.

[netmot]

Thanks, I will try to find out do's and don't prior to filing for bankruptsy from somewhere.

 

Regards

[gizmo111]

There isn't really a do and don't but some very good advice here TMF: Bankruptcy - questions and practicalities / Dealing with Debt

[netmot]

Fantastic just what I was after, thanks gizmo111.

 

Regards

[geministar2007]

Thanks for advice all, i'm gonna try and stick with my DMP for now, while i take in more info ref bankruptcy.

 

Is it true, that when you go bankrupt. that you get put on a NR??? tax code or something, for the first 12months, you pay no income tax, but this has to go the OR at the end of the year?

I do not like the thought of my employer knowing a diff tax code/link it to bankruptcy or whatever.

 

Any other advise would be great.

 

Thanks

[phat256]

yes i you are put on a NIL tax code but you don't keep it it goes straight to your OR . it is done until the 5 april of the tax year .

 

It is done in order to increase your income so you can contribute toward your BR estate. sometimes if you don't have any surplus your NIL tax code will be your IPA

 

 

there is various, other than BR, reason why you are put on a NIL tax code.

 

your employer will only find out if you doing a job which is restricted by BR

[geministar2007]

Ipa???

[geministar2007]

Hi ok i have been umming and arghing going bankrupt for months now. I have been on a DMP for the majority of this year, but as some creditors are still charging interest i somehow do not see the point at the present moment i owe nearly 15k and my DMP is estimated to end in 2046!!

I have recently reduced my DMP payments from 103 a month to 32 a month for a period of 3-6 months.

As my DMP amount has reduced some creditors arent happy, so all the hassle begins again and some were not happy with the intial amount they were receiving.

 

Ok so i have my bankruptcy forms, i did have an appointment but cancelled and i couldnt really afford the sum.

 

What i would like to know is the following:

 

I do not have bankstatements etc for the past 12months i tend to keep the current months. Is this a problem?

 

I live with my partner he works earning nearly 15k a year and i work earning around 10k a year. We rent out home. We are NOT married. I have no assets, i dont even drive.

No debts are joint it is all mine, mounting up before i met my current partner.

So would my partner be effected?

 

We claim working tax credit NOT child tax (we have no children), if claiming working tax can i get some of the bankruptcy fees waivered?

 

Also what bank account is best to open, i currently have a basic cash account with lloyds but realise i will still have to open another basic bank account.

 

Finally would my employer have to know i have gone bankrupt? I believe you dont pay tax for a year??? This goes to the OR. I have a minimum wage job. I don't work in Finance i am a Receptionist.

 

I look forward to recieving some advice.

 

Many thanks

[phat256]

 

I do not have bankstatements etc for the past 12months i tend to keep the current months. Is this a problem?

 

no it isn't a problem when u will become BR your OR will request to your Bank all statmemtn and credit agreement. i didn't have any to be honest and i was fine

 

I live with my partner he works earning nearly 15k a year and i work earning around 10k a year. We rent out home. We are NOT married. I have no assets, i dont even drive.

No debts are joint it is all mine, mounting up before i met my current partner.

So would my partner be effected?

 

no it shouldn't really affect your partner but if u do not have a joint account i would advise your partner to write to a credit reference agency for a letter of dissocation so your Bad credit will not affect his one. BR is personal event if u were maried u will still have to apply for BR seperately , like i did .

 

We claim working tax credit NOT child tax (we have no children), if claiming working tax can i get some of the bankruptcy fees waivered?

 

u may be entiltled to have the court fee waived and i say maybe ! iwas awarded that but u will still have to pay the OR fees whic is 395 pounds

 

Also what bank account is best to open, i currently have a basic cash account with lloyds but realise i will still have to open another basic bank account.

 

there is 2 bank accepting undischarged BR the co-op and Barclays. it was advised to me to open them after my BR order as the OR will not have any access to it as it i will be consider as an after acquired asset.

Finally would my employer have to know i have gone bankrupt? I believe you dont pay tax for a year??? This goes to the OR. I have a minimum wage job. I don't work in Finance i am a Receptionist.

 

 

your employer willnot not know if your are BR unless it reads the london gazette, the br notification or you are into a regulated professional job. i am on a NIL tax code but i earn very little and i don't have an IPA. however if u pay enough tax it will run until the 05 april of the year you were made BR. so if you are BR in march well you will not have an IPA.My other half work s full time and earn the national mimnim wages it was put on an a NIL tax code IPA until 05 april 2009 . u can have a nil tax code for many reason and not just because you are BR

I look forward to recieving some advice.

 

Many thanks

 

i hope it helps and good luck

[geministar2007]

brilliant thank you.

 

Are there any letters that can be be wrote to creditors once i have made my bankruptcy appointment at the court? You know to get them to back off for a month. i ask as i am on a dMP and thinking of stopping my payments for that to put towards the bankruptcy fees. Also as i keep having a DCA pop up every now and then at the mo marstons and there bloody blanket email (you have prob seen the posts on here). Would just lke to be left alone until the new year.

 

Thanks again.

[geministar2007]

also did i read somewhere about utility suppliers helping with bankruptcy fees???? Or am i going mad with all the stress going on in my life.

 

if so how does this work? I rent a fully furnished flat and don't pay for my utilities.

[geministar2007]

Will my landlord be informed i have declared myself bankrupt?

 

Where i live does not involve a credit check, we dont even have a contract.

 

Also what happens if i go bankrupt as an individual? My partner owes money with his wife (now separated, she is in NZ) and if he decides to go bankrupt himself?

 

My debts are only in my name.

[geministar2007]

I was just wondering what happens to someones debts when you are bankrupt.....

 

Do they merely disappear into thin air? Or do they get paid off by some magic pot for you?

How does bankruptcy effect our economy in general?