Serious debt questions. need help please

[standingupformyself]

Hi

I have my own fair share of problems! But am asking some more for my friend, who as yet is not registered on this site..... Can anyone help please.

She is a mature student at uni, Mum of three and a single Mum, she is a council tenant and up to her eyes in debt... trying to get help and advice but cannot find out everything she needs to know....

• Wants to declare herself bankrupt.. Is this possible when her main income is a student loan? Can she continue to receive her student loans whilst bankrupt?
  
• Will she have to pay the full bankrupt costs, ie £475 or will she get consession?
  
• Just had student loan come through, very little of it is left already, paying back friends etc.. will that be a problem?
  
• Have heard rumours that the bankruptsy system is changing in May, what difference will that make? Will it become harder?
  
• BALLIFS, are chasing her for council tax, have got three payments left for £50 each month, what is the score with them, her car is something they are interested in.
  
• Her car is not worth a fortune, £500ish and she needs it for the kids, unit etc and cannot afford to replace it. Is it safe?
  
• booked a holiday some months ago... to Turkey, supposed to be going in May, will they keep her passport?

[gizmo111]

A lot will depend on what her debts are made up of. Student loans cannot be included in bankruptcy.

Another thing to consider will be what profession she is studying for, as some jobs to not allow bankrupts to be employed.

If she is a full time student has she enquired as to whether she should have been council tax exempt.

The OR will not be interested in a car worth £500, especially as she needs it for work etc.

Nobody will keep her passport, but I question the logic of someone on the verge of bankruptcy booking a holiday they clearly can't afford.

Have a read here for more information.

And I am not aware of any changes coming in MAy could you tell me a bit more please?

[gizmo111]

Also check entitledto to make sure she is receiving all benefits she is entitled to.

[standingupformyself]

Thanks for the reply. The holiday was booked and paid for by her hubby months and months ago, they have since seperated (Last November) but the holiday still exists. I dont imagine she will be able to rustle up any spending money, things really are dire for her. But the holiday was bought and paid for when circumstances were totally diffferent.

Since my last post a few hours ago, we have gone through the court papers and phoned to make an appointment to submit the papers and apply for bankruptsy. First of all the clerk said that the week commencing 8th May was the week, she said it was changing that week and ooperating on a first come first served basis.... basically just turn up and queue your turn. My friend then asked what the possibility of a cancellation prior to that date was. The lady came back to us moments later and offered her tomorrow mid morning! Wow;

 

I think you mis-understood the question about the student loan though. We wondered would she still be able to apply for it and receive it, as it is a form of credit as-such. Because the loan is a large part of her income.

 

I think she probably is receiving every benefit she is entitled to, as she has spent time with the CAB and also the financial dept within her university. I don't think they have left any stone un-turned on her behalf

[standingupformyself]

The car is subject to a baliffs order, although she has only 3 payments to go on that...... Hopefully you are right and it will be safe.

 

At Uni, she is training to do social-work type stuff. Working with young adults. She has already clarified that this is not a problem

[gizmo111]

The car is subject to a baliffs order, although she has only 3 payments to go on that...... Hopefully you are right and it will be safe.

 

At Uni, she is training to do social-work type stuff. Working with young adults. She has already clarified that this is not a problem

 

I woudl be careful, as a social worker registered with the GSCC she may not be able to practice.

Who has she checked with?

[standingupformyself]

via her university. Having said all that though, would the rules be the same for a bankrupt as opposed to a discharged bankrupt?

[gizmo111]

If she is doing the social work degree she will be registered with them as a student - she needs to check with the GSCC - I know you cannot go bankrupt whilst practising - don't know about students.

[standingupformyself]

I appreciate your advice and help. Thank you

[powelll]

Just had student loan come through, very little of it is left already, paying back friends etc.. will that be a problem?

 

Just a quick point re the above - If the OR sees that e.g friends have been paid back while other creditors have not this may cause a problem. They may take the view that she has unfairly prioritised friends over other creditors ( will depend on their interpretation ) so she may be subject to a BRO or BRU ( Bankruptcy Restriction Order or Undertaking ). This basically means that when she is discharged from bkrptcy ( usually within 12 months now ) she can still be made subject to the restrictions of bkrptcy for up to 15 yrs ( 15 yrs would be pretty unusual to be fair! ). Main restrictions include things like no credit totalling over £500 without advising she's bankrupt. This can include things like utilities and phone bills etc.

 

I would really recommend your friend speaks to National Debtline on 0808 808 4000 for some free confidential advice as they are pretty good on bkrptcy advice...

 

Hope this helps

[danmav]

Thanks for the reply. The holiday was booked and paid for by her hubby months and months ago, they have since seperated (Last November) but the holiday still exists. I dont imagine she will be able to rustle up any spending money, things really are dire for her. But the holiday was bought and paid for when circumstances were totally diffferent.

Since my last post a few hours ago, we have gone through the court papers and phoned to make an appointment to submit the papers and apply for bankruptsy. First of all the clerk said that the week commencing 8th May was the week, she said it was changing that week and ooperating on a first come first served basis.... basically just turn up and queue your turn. My friend then asked what the possibility of a cancellation prior to that date was. The lady came back to us moments later and offered her tomorrow mid morning! Wow;

 

I think you mis-understood the question about the student loan though. We wondered would she still be able to apply for it and receive it, as it is a form of credit as-such. Because the loan is a large part of her income.

 

I think she probably is receiving every benefit she is entitled to, as she has spent time with the CAB and also the financial dept within her university. I don't think they have left any stone un-turned on her behalf

 

If she becomes bankrupt she will be able to continue receiving her student loan. The Student Loans Company do not perform any sort of credit check as it is not a "normal" loan and is repayable through your earnings (once you earn over the limit, currently £15000) after leaving uni.