Bankruptcy Question

[victortebbit]

Hello all.

 

I feel Bankrupty is the way to go at the moment.

 

Am going to be made redundant soon, and will probably be on benefits for a while.

 

I was repossessed 2 years ago, and have just received a demand from the mortgage company for £64,000.00.

 

Also have outstanding debts for electricity and countil tax.

 

I presume that as the house has been repossessed allready, my debt is now "unsecured" and therefore Bankruptcy seems the obvious answer, as I have no assets to speak off, and am likely to have no income other than benefits in the foreseeable future.

 

Am just looking into it at the moment, and trying to get a clear idea of what options there are, and which is the best route to take.

[GuidoT]

Welcome to CAG.

 

Seems sensible, but I will let someone who knows about such give you some proper advice.

 

I have a friend who was discharged in 3 months and it was relatively painless. He is now re-building his life.

[comebackjimmy]

Hi

 

Not sure if Council tax gets eliminated in a bankruptcy so watch out for that one, just in case.

 

Wait for other CAGers to comeon and clarify that and other things.

 

Also, if you must do it, do it soon as the price is about to go up!

[victortebbit]

Have been led to belive that the council tax is eliminated for debts up to date of the bankruptcy order.

 

Would happily pay the council tax and electricity anyway, it is the £64000.00 that the mortgage company wants, that has led me to consider bankruptcy.

 

Still considering the options, but looks like bankruptcy may be the "least bad" option

[loobyloo85]

Hi there, based on your circumstances, bankruptcy does seem a good option for you. As you have no assets of a high value, you would not lose anything by doing this. The £64K from the property repossession would be unsecured, so this would be written off in bankruptcy, and you would be debt free after 12 months.

Also, as you are on benefits at the moment, you will not have to pay the full bankruptcy fee, you can claim some of this back.

[Dodgy Geezer]

Have been led to believe that the council tax is eliminated for debts up to date of the bankruptcy order.

 

This is correct. And all other utility bills, gas, electricity, water, etc.

 

If you decide to go BR, stop paying everybody ASAP. You will need those funds.

 

Would happily pay the council tax and electricity anyway, it is the £64000.00 that the mortgage company wants, that has led me to consider bankruptcy.

 

The Mortgage Co can pursue you for 12 years for the debt, and add interest for 6 years. You have a perfect opportunity to eliminate this worry, and in your circumstances be discharged from bankruptcy in as early as 6 months.

 

Best Wishes

[Wintry]

Hello all.

 

I feel Bankrupty is the way to go at the moment.

 

Am going to be made redundant soon, and will probably be on benefits for a while.

 

I was repossessed 2 years ago, and have just received a demand from the mortgage company for £64,000.00.

 

Also have outstanding debts for electricity and countil tax.

 

I presume that as the house has been repossessed allready, my debt is now "unsecured" and therefore Bankruptcy seems the obvious answer, as I have no assets to speak off, and am likely to have no income other than benefits in the foreseeable future.

 

Am just looking into it at the moment, and trying to get a clear idea of what options there are, and which is the best route to take.

 

Hi Victor

 

As Looby says bankruptcy sounds like it could be the option / solution.

 

However before you make any decisions make sure you take independent full in depth advice on all your options / solutions including bankruptcy (and timing of). Especially taking into account any redundancy payments / pay in leu / holiday pay you may be receive or be due.

 

Council Tax arrears are a provable debt in bankruptcy however there can be issues if it has reached the stage where bailiffs are involved.

 

Best wishes

[Wintry]

Hi Dodgy,

 

Apologies if I have duplicated, missed your post

[Dodgy Geezer]

Hi Dodgy,

 

Apologies if I have duplicated, missed your post

 

No worries. Its great that people offer advice. People dont have to take it, but sometimes just a word of comfort in this difficult time helps.

 

If the council tax gets to bailiff stage, the liability order will become void from the date of the BR.

 

The only thing there is that the bailiffs wont get a single penny. Now thats music to my ears.

[debtinfo]

If the council tax gets to bailiff stage, the liability order will become void from the date of the BR.

 

not really true im afraid, see the OR's technical manual

 

9.11B Local authorities – timing of distress in bankruptcy proceedings

(November 2008)

The right of local authorities to distrain for unpaid council tax and non-domestic rates (pre and post bankruptcy order) is exercisable at any time, including after the bankruptcy order and even against property comprised in the bankrupt's estate, in accordance with section 347(8) and (9) of the Insolvency Act 1986. The only exceptions being where an application for an interim order, under section 253 of the Insolvency Act 1986 is pending, whereby the court may forbid the levying of distress under section 254(1)(b) of the Insolvency Act 1986. Additionally, where an interim order has been made under section 252 of the Insolvency Act 1986, leave of court must be obtained before distress is levied (see paragraph 9.37).

[Dodgy Geezer]

Ok. Thanx for that.

 

I guess i got lucky.

[debtinfo]

it is an aboration that sticks out as contrary to the general principles but is accurate. In practice some councils will voluntarily write of the debt so worth sending them a copy of the bankruptcy order anyway

[Dodgy Geezer]

The advise i gave was as per given to me by my council. They wrote off £1.2k for me without question.

 

 

Bless um.

[victortebbit]

Cheers for the pointers -- early days yet, but looking increasingly like the path to take.

[victortebbit]

Cheers for the pointers -- early days yet, but looking increasingly like the path to take.