I made myself bankrupt 2 days ago ...big mistake can I go back to my IVA

[Bailey3]

Please help. I got into £65,000 of debt, various reasons that are not important now, my husband also has £20,000 debt. We have our mortgaged family home and a buy to let property, both of which are in negative equity although only by about £5,000. All mortgage payments are up to date.

We both applied for IVA's, mine was accepted and my husband's refused so he went into a DMP. I paid £338 per month and he pays £100 from March 2010.

I am self employed, my husband is employed.

Shortly before it all went through I became unwell, had an allergy to the medication, had to have radio active iodine ... all this lasted a year during which time I couldn't work very much. This, coupled with the recession, meant I couldn't keep up the payments. I am two and a half payments behind.

 

I spoke to my IVA company and to another company and read heaps and decided fail my IVA and to go bankrupt. I filed my petition on Friday and the OR rang me today to set up a meeting. Some things I didn't know:

 

1) I would have to pay my half of the rent to the OR and my husband would have to pay the mortgage. My half after service charge etc is £325

2) I work for a couple of companies where I do a job over 6-8 weeks, I have to tell them I am bankrupt so they can stop the contract at the date of bankruptcy and start again after that date. If I tell them I am bankrupt they are unlikely to give me more work (purely because of the nature of my work, although it isn't financially related). They currently account for two thirds of my income.

3) As the car is registered in my name I have to prove that it is a family car and that my husband contributed to it's purchase 4 years ago.

 

It is clear that bankruptcy is totally the wrong option for me. I have since spoken to family members who can pay the IVA arrears and will fund the next 6 months while I get back on my feet work wise.

 

What can I do? Can I cancel the bankruptcy and go back to the IVA

 

Any advice welcome as I am out of my mind with worry.

 

Thank you

[citizenB]

[quote name=rebel11

 

 

]Yes, it can be cancelled. Not straightforward.

 

 

Can my bankruptcy be cancelled?

 

 

Hello Bailey,

 

Apparently yes. Please see link above from one of the site team

[Bailey3]

Thank you. I am liaising with the IVA practioner and the OR to get it annulled, expensive and not easy but doable

[citizenB]

Would be interested to hear how you get on. Please update if and when you can.

[Bailey3]

Can anyone help with the wording of the affidavit please

[42man]

Oh gosh.....I do have some knowledge of the BR process and affadavits but not one where you are applying to reverse....may I ask for what reasons you are applying ? medical ? ignorance of the law is not an excuse for annulling, and you say it is do-able but at what expense ? If you do have a meeting then you still have to go through 'the motions' relinquishing bank cards, giving details of all debts.....and you MAY have to pay the expenses of the Official Receiver too.....what advice have you received already ?

[Bailey3]

Current situation is that I have applied to the court for the anulment, am just waiting for a date.

 

My reasons were that I had an IVA in force that I had fallen behind with by 2.5 months, that I sought advice but the advice didn't mention that I would need to pay the OR half of the rental of a property I have that is equivalent to the amount I was paying on the IVA so neither myself nor my creditors would be any better off.

 

I said that the OR had informed me that I may have to inform a company I work for as I do contract work for them and some of the work was done before the bankruptcy and some afterwards and if I did this because of the nature of my work it was unlikely that I would get any further work from them which would reduce my income by two thirds.

 

 

I said I hadn't been sleeping and was very stressed and exhausted and could not see any way out and panicked.

 

I said that my IVA has been reinstated and a family member has paid the outstanding payments and will guarantee any future payments should I have insufficient funds from my income.

 

I have a meeting with the OR tomorrow which I am sure won't be pleasant as we have to go through all the formalities as the bankruptcy is effectively still in play, and I intend to cooperate fully.

 

It will cost me around £1700 for the OR costs, maybe more, but a family member will pay it for me.

 

If only I hadn't let my pride come into play and had asked my family before bankruptcy!!

Edited December 9, 2011 by citizenB
Popped in some paragraphs for easier reading :)

[citizenB]

If she has her interview today then she will have to show solid proof that she is applying to file an annullment before they appoint a trustee.

 

Some advice for you from 42man - good luck with your interview

 

PS.. could you please come back and let us know what happens as it will surely help others should this question arise in the future.

[42man]

I (name) do hereby apply for the annullment of my bankruptcy (number of 2011)

 

The defendant has been in an IVA since (date) and as of this date is up to date. The payments have been guaranteed.

The defendant realises that they would be in a particularly disadvantaged situation in relation to obtaining future contract work due to the nature of this work.

The defendant has been on medication etc etc (if applies)

The defendant gracefully requests the judge grants the annullment.

 

AFFIDAVIT

 

I (name) of (address), (occupation)

 

MAKE OATH and say as follows:

 

 

I make application that the court annul the bankruptcy order by powers granted

under section 282(1)(a) of the Insolvency Act 1986 on the grounds that the bankruptcy order should not have been made.

 

____________________________________

Signature

 

SWORN AT (address)

this day of year

 

before me,

 

 

 

____________________________________

(A Solicitor or Commissioner for Oaths)

[42man]

You will need to get the affadavit sworn in either when you take the annullment documentation to court (most courts do it for free) otherwise get a local solicitor to do it....should cost around £5 to get that done....

[Bailey3]

Thanks 42man but your post came after I had filed the annulment but it isn't far off what I wrote. Threw in an apology at the end for any waste of court time, OR time etc etc.

I went to see the OR yesterday and actually it wasn't unpleasant. I think she empathised with me a little in that my debts hadn't accrued because I had some lavish lifestyle but had started when my husband got blood cancer and was in hospital for 6 weeks (literally within days of us moving to a new house) and then off work for a year, then had to take a lower paid job, and we just never financially recovered from that.

My main problem now is that the Court is currently issuing dates at the end of March 2012 (I should get a date any day now). The OR has 8 weeks from the date of bankruptcy (25.11.11) to prepare her report and (I think) appoint a trustee (I may have got that wrong). At the moment the OR costs are £1715 to annul but once the 8 weeks have passed they go up significantly and I want to avoid that. The Court have been very helpful and will try and get me in earlier but wondering if there is anything I can do.

Read somewhere about a Stay of Bankruptcy but not sure if that is relevant.

 

Any advice?

[Bailey3]

Thankfully I have managed to get a court date of the 22nd December. Anyone know what I can expect from the hearing?

[citizenB]

Will track 42man down for you - hopefully he will know.

 

I am pleased it wasnt as bad as you thought it would be and that you have an early date.. with any luck it will all be sorted before Christmas

[42man]

I'm not familiar with a court hearing in your own circumstances where you have made yourself bankrupt and then want to annul.....I have no idea how the judge will be...I'm sure you will be ok, but judges can vary quite wildly.

[42man]

I also cant understand why after 8 weeks the costs go up...once you have a court date then the OR should stop any continuing action as an annullment case is in progress. And I certainly cant see them appointing a trustee until the case has been heard. It is likely that the OR will send a representative to the hearing too, I think the judge may ask them how they feel about it, but providing you are prepared to pay their costs then they will probably be fine with it.

[Bailey3]

Thanks all. I am expecting a huge rap on the knuckles for wasting court time etc but I can take that on the chin. Will update you next week.

[citizenB]

I am sure they will look at the circumstances that led up to this and see that you were panicked rather than being able to think rationally about the situation.

[citizenB]

Bailey, are you able to update us on this, please ?

[Bailey3]

Yes sorry. Lovely lady at the court managed to get me in on 22nd December. It wasn't even a fraction as bad as I thought, the judge was very friendly and just said he had no objections to the annulment and neither did the OR as long as they got their fees. He asked me how I was going to pay them and I told him so he said he would give me 14 days to pay them (have to go back to court on 19.1.12) and once paid he will annul it.

So it's ended up costing me £700 to go bankrupt and £1700 for the OR fees (thank god for my family). Now I am just going to work as hard as I can to get everything paid off and vow never to get in this situation again.

Thanks for all your support and happy new year.

[citizenB]

That is good news. I am so pleased it wasnt as horrid as you thought it might be.

Happy New year to you as well