AA99 & Bankruptcy

[AA99]

After doing battle with 14 creditors since August last year, we are exhausted with it all and really cannot see a way out so have been seriously considering bankruptcy. My OH turns 60 this year and is on Income Support/Incapacity Benefit, my eldest son lives at home and is on JSA, my young son is in receipt of DLA and I receive carer's allowances for them both.

 

OH has the following accounts, 1st figure is the spent Credit Limit, 2nd figure is current balances:

 

MBNA Acc.2 5,000 6,120 No CCA & DN issued

MBNA Acc.3 6,000 7,254 No CCA & sold to 1st Credit

B/Card Acc.2 5,700 6,000 No CCA

B/Card Acc.3 1,800 1,605 Repay 20 p.m. no int & charges

CapOne Acc.2 200 372 No CCA

N/Wide Gold 5,920 5,890 Repay 20 p.m. but now adding charges

Natwest Card 4,850 4,788 Repay 25.78 p.m. no int & charges

Total 29,470

 

Myself:

 

MBNA Acc.1 8,600 10,017 No CCA, sold to Apex

B/Card Acc.1 3,500 3,284 Repay plan 39 p.m. no int & charges

CapOne Acc.1 800 1,062 Sold to Freds, but with ICO as well

GEMoney(CAR) 8,790 7,099 Sold to Link

M&S More 3,000 2,823 Repay plan 20 p.m. no int & charges

Argos 800 800 39% interest!

Catalogues 800 800 39% interest!

Total 26,590

 

Also have joint flexaccount with Nationwide and 1,800 agreed overdraft.

 

We are permanently 2 weeks in arrears with our rent (private landlord tenancy in 6th year now) and have Atlantic Gas & Elec threatening for 600 arrears, mainly due to their 29% increase backdated.

 

I have managed to agree and arrange repayment plans with interest & charges frozen with the ones indicated but the others are just not interested. I have CCA's them all, SAR'd MBNA, but they're all just hounding me for their own charges and extortionate interest rates.

 

I'll stop there and look forward to CAGGER colleagues responding 8-)

[phat256]

have you though ringing national debtline !

 

if you go BR then i woudln't bother with CCA , SAR etc... as everything will be wiped off however be careful with your rent arrears .

 

DMP then if go BR stop paying them and save that money towards your BR fees , but be warned your creditor will be hassling you.

 

if you go BR max out our overdradft and credit card ( even use your credit card or overdraft to pay for the BR fees, my partner did just that !), as you will need money for living expenses while you are setting up your new bank account either with the co op or barclays.

good luck but most important of all take some financial advise befoer hand!

[AA99]

Thanks phat!

 

I range National Debt Line back in July 2008 and they decided then that we had more outgoings than income!

 

However, with juggling figures around, and to avoid BR,

I took their advise and wrote to all our creditors with an I & E and offered to repay them all £20 p.m.

Some accepted, the majority ignored.

 

I have since then, CCA'd them all and bounced ALL the letters back and forth but they really haven't been interested.

Have a call recorder and must have had over 300 calls from DCA's too!

I understood that being on benefits, we would be exempt from the fees:confused:

 

Also didn't know if it was preferable if only one of us went BR:-?

 

Even on a DMP with £1 each, it's going to be a lifetime:confused:

Have applied for a Coop Cashminder account - pending:(

[fleeced_by_rbos]

Definitely get as much advice as you can from Nation Debt Line and perhaps Citizens Advice before going that route as permanently puts a big cross over your financial records, even more than a CCJ afaik.

 

Good luck my friend and keep us posted about what you are told.

[WelshMam2009]

I understood that being on benefits, we would be exempt from the fees:confused:

 

Nope, you have to pay that yourself.

 

I'm not a professional AA99 but, if I was in your shoes, and in rented accomodation, I would be going down the bankruptcy route. The only thing that stopped me is that I am a home owner and there is equity in the property, albeit rapidly reducing!! :grin:

 

It is so commonplace today that there is very little stigma attached. It is also the quickest way to resolve your problems, other than winning the lottery of course!! Make sure you get your bank accounts set up first though.

 

Is it really such a bad thing that you can't get credit?? Afterall, that's what got you into this mess in the first place. Also, looking at the positives, you'll probably be at low risk of identity theft as no beggar will be able to get a penny in your name!! 8)

[GamekeeperToPoacher]

I have a number of friends who have gone BR and it is ridiculous how short the period is that you are undischarged.

One of them kept his car as he bought it with a bank loan and it is a tool of the trade. As long as he earns very little for 3 months he will be discharged shortly after.

 

The gubbymint is embarrassed about the numbers and are desperate to massage the figures down.

 

GKTP

[phat256]

I am a bit furious by this assumption !

i am disabled and my Or will not let me have an ealy discharge because i earn very little or more exactly

( trust me i cant get any benefit because my other half work full time but i cant get too work as i am unfit for it ).

 

The earliest i have known to be discharge is 6 month after the BR order was made.

 

this is a very false assumption !

[WelshMam2009]

I think 1 year is now commonplace??

 

It remains on your credit file for 6 years I believe so does have a lasting effect on your credit file.

 

I don't think GTP was meaning to be offensive...just highlighting the rising numbers...which me thinks is going to increase substantially in the current economic climate.

[AA99]

Absolutely Welshmam, no offence Phat, but we are really broke people with no jobs and no houses. It's almost laughable every day to hear about people losing their jobs and houses. We should be so lucky

[AA99]

I have a number of friends who have gone BR and it is ridiculous how short the period is that you are undischarged.

One of them kept his car as he bought it with a bank loan and it is a tool of the trade. As long as he earns very little for 3 months he will be discharged shortly after.

 

The gubbymint is embarrassed about the numbers and are desperate to massage the figures down.

 

GKTP

 

A businessman friend who's business is booming, don't ask me how/why, popped in tonight and he said go bankrupt, everyone's doing it

[fermi]

You would each need to pay the OR's deposit of £360. There is no getting out of that one.

 

If you are on certain benefits, or have a gross annual income below a certain level then you may be exempt from paying the additional £150 court fee that is payable on top of the above.

 

The exempting benefits are:

 

• Income Support

• Income based Jobseeker’s Allowance

• State Pension Guarantee Credit

• Working Tax Credit but not in receipt of Child Tax Credit

• Income-related Employment and Support Allowance

 

It is explained here if you can manage to wade through it all: http://www.hmcourts-service.gov.uk/courtfinder/forms/ex160a_e.pdf

 

Thinks carefully, but if you do go down this route then you are far from alone. ;-)

[fermi]

I think 1 year is now commonplace??

 

You are now discharged automatically after one year.

 

If your case is fairly straightforward and the admin can be done quickly then you may get Early Discharge.

 

Technical: IEL Reference Guide: DISCHARGE

 

The quickest possible for that under the regs is just over 5 months.

 

Basically, expect to go the year and if you are discharged earlier that is a bonus.

[WelshMam2009]

Looking at the statistics you've posted AA99, you aren't managing to pay your priority debts such as rent and utilities because of the payments you're making to your creditors.

 

I'm not going to mess around with your DMP other than to say this is wrong! You should always pay your priority debts first. BUT this does strengthen my reasoning that bankruptcy may be your only viable solution.

 

As soon as you decide to go down the bankruptcy route then I personally would not be paying anything more to the creditors. No court papers have been served on either of you and so any proceedings are a long way off.

 

Do you have any credit unions where you live who might be able to loan you the money needed to file for bankruptcy?

 

If not, then I would sit it out for a few months and put the money aside (into a different account) that you have not paid your creditors. Afterall, they can add all the interest and charges that they like, but at the end of the day, they will only be receiving a nominal payment...if anything at all.

 

As I said, I am sure that you will be seeking professional advice on this but I would try and get your rent up to date and also make sure you keep up with you council tax. Arrears on utilities can be written off but the company may then ask for a deposit up front.

 

Found a good little guide to bankruptcy here...incase you haven't seen it...

 

http://www.insolvency.gov.uk/pdfs/guidanceleafletspdf/guidetobankruptcy.pdf

 

Good luck and let us know how you get on!!

[AA99]

Hey, thank you all for popping in, and for your advice Isn't it crazy that you have to be able to afford to go bankrupt :

 

Just received our new lease this morning and it does mention bankruptcy:

 

We've been here nearly 6 years though and they do know we are on benefits:

 

I guess that may be one of the downsides of going br, you have to tiptoe round like a criminal:

 

The alternative for us is to have shown we have tried to deal with our creditors and pay them all £1 and get taken to court. What would a judge do ?:

[fermi]

To be honest, I think I have now seen literally hundreds of people in your position go through bankruptcy and I am seriously struggling to think of anyone where it in itself has caused a problem with a landlord/tenancy (bankruptcy clause or not).

 

What a landlord cares about is that you pay your rent after all.

 

There is a good argument that once you are rid of your debts, you will find it easier to make your rent. In some ways a BR is a good bet, since they don't have debts to service.

 

Since you have also been there 6 years in good stead I find it hard to imagine a problem.

 

Once you go BR you can also ask the OR if they would mind not contacting your landlord. S

 

ome will agree to this if you can show them the tenancy agreement and that you are up to date with it.

 

Some just won't agree full stop.

 

It is a nit of a lottery, but does no harm to ask.

 

Hope that helps.

[fermi]

Regards the fees. Here is some advice posted by NorthEast Derbyshire CAB elsewhere:

 

For those who have taken proper advice and decided on bankruptcy as the long term option for dealing with their debts, it is often difficult to raise the necessary fees. It is our experience that any delays in raising the fees for bankruptcy can often prolong the stress and suffering for those with overwhelming debts.

 

For anyone in this position, there are a number of charities and organisations that may help with Bankruptcy costs and fees depending on eligibility. Examples below.

• Severn Trent Trust Fund and other water trusts
  
• EDF Energy Trust
  
• Royal British Legion
  
• Some Trade Unions
  
  • Trades Union Congress
    
  • Union Finder from Worksmart
    

   

  [*]Turn2Us enables you to search for charities

Please note you will usually need the assistance of a recognised Debt and Money Advice Worker in completing applications relating to the above.

 

Also, please be aware that any applications to the above may take a number of weeks and are not guaranteed to be sucessful, however we know of many successful applications so it may be worth a try.

 

Wishing you luck, NEDCAB.

[palomino]

The key phrase is 'depending on elegibility'. Many people aren't so don't raise your hopes to high.

[phat256]

you can try bu t they will need proof that you have seeking advise form professional and that the only option is BR if you want some sort of help. it is a lot fo form filling etc... .... if you have a credit card , max it out an use it to pay your BR fees many many people dod that usually the OR turn a blind eye to that as the money goes to them .

 

thre fact you are on benefit it is a good sign it may mean you will not get any IPA at all. so your BR will be very straight forward such as mine .

[fermi]

It is a long shot admittedly, but I know a few people who have had their fees paid.

 

If you have no feasible alternative it might be worth a go.

[phat256]

i agree woith fermi one of my friend has his fee paid by his utilities company he told me it took a bit of time but it was relief not to have paid anything. i wish i could have had this luxury lol

[AA99]

Hey, thanks you guys, you're giving me such commonsense answers

 

you can try bu t they will need proof that you have seeking advise form professional and that the only option is BR if you want some sort of help. it is a lot fo form filling etc... .... if you have a credit card , max it out an use it already have to pay your BR fees many many people dod that usually the OR turn a blind eye to that as the money goes to them .

 

thre fact you are on benefit it is a good sign it may mean you will not get any IPA at all. so your BR will be very straight forward such as mine IS YOURS ON HERE? STARTED? FINISHED? .

 

i agree woith fermi one of my friend has his fee paid by his utilities company Why a Utilities company he told me it took a bit of time but it was relief not to have paid anything. i wish i could have had this luxury lol

 

Why shouldn't we be 'eligible'

[palomino]

Why shouldn't we be 'eligible'

 

Not sure of exact details but the utility companies may only help out existing customers, the British Legion may help only servicemen, etc.

 

Still worth asking though.

[AA99]

Not sure of exact details but the utility companies may only help out existing customers, the British Legion may help only servicemen, etc.

 

Still worth asking though.

 

Yes, thank you. Think we do qualify as my OH is ex-British Army and the Legion assisted us once in the past

[GamekeeperToPoacher]

Hi (raising head slowly - looking round quickly to spot incoming flack!)

 

One thing that I forgot to mention was the low level of debt that my mate had which I understand can make a difference.

 

Another friend went BR and left the country owing about 250k.

 

I am thinking that the better way might be to sit back and take care of priority debts and just take the CCJ's as they arrive or let them BR you which they wont.

 

If you are on benefits, as I am, then try to arrange for pre-payment meters with the utilities and they will take the minimum towards the debt that they can. They will not write it off other than through BR. This I am sure of as I was once the warrant officer - hence the posting name.

 

GKTP

[GamekeeperToPoacher]

One other thing I forgot to mention is that i understand that the British Legion will also assist family members of ex servicemen/women. As already stated it is worth an ask.

 

GKTP