Questions you have before making a decision to go Bankrupt and the Bankruptcy process

Moderators: TalbotWoods, JaneClack

By chandjay
#264633 Hi,
I'm new to this section of the forum, so please bear with me.

When listing my "outgoings", would it be better to list HALF of everything - Rent, Gas, Water etc and deal my wife's income completely out of the equation(or indeed am I allowed to do that),

OR
Have I to list everything in it's entirety, (full cost of Rent, Gas etc) and then state what my wife contributes to the household expenditure.

... And then, what would the O/R deem as a fair contribution from my wife .....All her wage ? Half her wage ?

Anyone got any advice.

P.S. And another thing - Is it acceptable to claim for Emergencies, Holidays, Hairdressing etc.
User avatar
By JaneClack
#264663 The Insolvency Service uses the National Family Expenditure Survey for its guidelines - have a look at the technical manual.

Technically you should not have to say what your partner brings in - but they will ask!!! It may be that she brings home less than you so you could say you have to pay more to the bills. If she earns more then half would be reasonable as the OR could ask - however she is entitled to her own expenditure - but do check on the technical manual.
By mcuth
#264733 Personally, what I did was this - I put down the entire outgoings for the household and also what SWMBO contributes (not what she earns!). The OR then used that to work out what my %age contribution was to the household budget and from that, what %age of the outgoings was mine - they then used the "contribution amount" of each outgoing in calculating my outgoings for the IPA. It worked well for me and I felt it was a very fair calculation.

As far as working out what SWMBO contributes - well, call it a little "practical" but she earns a little over half what I do and we'd already worked out what amount she needed to contribute to the household account so it was fair (rather than split 50/50). Basically she kept her own account and sent a payment each month to the household account, which also made it easier to take out her own outgoings out of any equation.

HTH

Cheers
Michael
By chandjay
#264763 Hi mcuth,
You earned more than your wife, but in my case, my wife earns more than me. This is because I only have my occupational pension to live off (I'm unemployed)
It might be better if I kept my wife totally out of the equation, and just claimed half of everything, meaning that my wife would contribute the other half to everything.
I was thinking that the OR couldn't have any issues if my wife and I were both contributing 50% each to all household expenditure.
After all, what can be fairer than 50%.

P.S. No-0ne has answered my other question :-
Can you claim for or does the OR allow for Emergencies, Holidays, etc as part of the outgoings.
On my DMP, I made allowances for these, and I'd like to continue doing that.
By DARIUS
#264813 Hi there chandjay

When my hubbie and I declared ourselves bankrupt, we put down for haircuts, kids swimmming lessons, sky tv, christmas and birthdays.

Hope this helps

Good Luck :)
By mcuth
#264833
chandjay wrote:You earned more than your wife, but in my case, my wife earns more than me. This is because I only have my occupational pension to live off (I'm unemployed)


Ah ok, I getcha and didn't realise that was the case - the principle is exactly the same the other way around, but then of course your contribution would actually be less :wink:

chandjay wrote:P.S. No-0ne has answered my other question :-
Can you claim for or does the OR allow for Emergencies, Holidays, etc as part of the outgoings.
On my DMP, I made allowances for these, and I'd like to continue doing that.


Sorry, missed that one - holidays can be listed (there's guidance in the technical manual as to amounts that are considered reasonable), but I don't think "emergencies" can - however you should definitely list expenses such as haircuts, christmas, birthdays, etc. too.

Cheers
Michael
By chandjay
#264843 Hi,
What I mean by "emergencies" is ..... What happens if the washer packs in...? or the cooker blows up?

How would I be able to contribute towards their replacement if I didn't put aside money every month for such "emergencies".
The "emergency" allowance that I was hoping to claim for, is really an insurance policy(of sorts) that would allow me to contribute towards the replacement of worn or broken appliances, as and when required.(or anything else, for that matter)
That was always the argument that I put forward in my DMP, which I thought was reasonable.

The one worry that I've got with the OUTGOINGS submissions is that it would appear that you only have one shot at getting it right, and making sure that EVERYTHING is claimed for.
For instance, I can't see that six months down the line, you can ring up the OR and say ... " Oh by the way, I've just remembered. I forgot to include my PILE OINTMENT in my outgoings, can you bung another 3 quid a month onto my outgoings, please".
By then - surely - it will be too late.
I'm worried that I have to get it right, as there is no "second bite of the cherry" and that if I've forgotten something(or several things), then If I get an IPO/IPA(I haven't a clue which is which?), then I may struggle to pay my 50% to the household expenditure.
I don't want my wife having the burden of subsidising my half of the expenditure. She already has the burden of living with me to contend with.

Does anyone see what I'm on about ?
By mcuth
#264853
chandjay wrote:What I mean by "emergencies" is ..... What happens if the washer packs in...? or the cooker blows up?

How would I be able to contribute towards their replacement if I didn't put aside money every month for such "emergencies".


IMHO, being unable to have a "contingency fund" is a failing in the process, but I believe that if such an emergency occurs that you'd contact Moonbeever and explain it (possibly reducing that month's payment as a result).

chandjay wrote:I'm worried that I have to get it right, as there is no "second bite of the cherry" and that if I've forgotten something(or several things)


If your circumstances change, you can have your revised outgoings reviewed and the IPA/IPO adjusted if necessary - so, although you should get as much down and as accurately as possible at the start, it's possible for it to be changed later.

chandjay wrote:then If I get an IPO/IPA(I haven't a clue which is which?), then I may struggle to pay my 50% to the household expenditure.


IPA = Income Payments Arrangement = a monthly payment that you agree with the OR
IPO = Income Payments Order = if you & the OR can't agree to an IPA, then a judge would review the file and make an Order (this could be higher or lower than the OR's original proposal).

chandjay wrote:I don't want my wife having the burden of subsidising my half of the expenditure. She already has the burden of living with me to contend with.


LOL :lol:
But seriously, the idea behind the income/outgoing assessment and IPA calculation is that it allows your normal reasonable household expenditure to be accounted for from your income so you're not left short and, if there's anything left, it allows for a contribution to be made to the costs and the debts included in the BR.

chandjay wrote:Does anyone see what I'm on about ?


I think so - hope the above helps?

Cheers
Michael
By mcuth
#264863 BTW, you might find the following useful:

IS Technical Manual
http://www.insolvency.gov.uk/freedomofi ... efault.htm

Guidance on making an income & expenditure assessment
http://www.insolvency.gov.uk/freedomofi ... part_2.htm

Household expenditure survey figures (s31.7.23)
http://www.insolvency.gov.uk/DocumentLibrary/Policy/Excel/Household%20Expenditur.xls

Cheers
Michael
By rikw
#264873 Hi Chandjay, I ve also seriously considered this option , but for what Ive read since the new guidelines, has really put me off, true it may be said that you finally become debt free, but I ask my self at the end of the day is it really worth it, if it is going to cause great hardship. I know it is said that the allowances are more generous, but from my experience recently of things happening out of the blue, I would have been in a right mess, like when I had to take a pet to an emergency vet that cost a fortune, they dont allow you to have pet insurance, so would have had to find hundreds of pounds. I know I have said that I would use this option but only for my benefit and has a very last resort. Im hope you are well, my gran used to say "if in doubt do nowt" Im going to stick with that advice for now
By chandjay
#264883 Hi mcuth,
Thanks for the replies.
At least some of the things that I was worried about have been cleared up.
A lot of the information that you've provided has been very helpful, and I thank you again.


Hi rikw,
Don't think that I haven't already thought about backing out and carrying on my DMP.
On my DIY DMP, I have been in total control for four and a half years, and lived a fairly comfortable lifestyle, with very little worries ...BUT ... this is really worrying. I will have no control over what the OR may say or do or want or take or anything, and that is frightening. Will my car go? .. How much will I pay with an IPA?
How will others see me, or look on me, if/when they discover that I am a bankrupt?
All these things worry me, but I still feel the time is right to do it.

P.S. Your Granny seems like one sensible dude to me.
By mcuth
#264893
chandjay wrote:Hi mcuth,
Thanks for the replies.
At least some of the things that I was worried about have been cleared up.
A lot of the information that you've provided has been very helpful, and I thank you again.


You're more than welcome - if I can help with my own experiences, then that's the whole point :)

chandjay wrote:I will have no control over what the OR may say or do or want or take or anything, and that is frightening. Will my car go? .. How much will I pay with an IPA?
How will others see me, or look on me, if/when they discover that I am a bankrupt?


Can completely understand that - I think those are things that we all worry about and go through. From my experience, my OR was very understanding and fair with my outgoings and we reached an agreed IPA without too much hassle (though I did have to request for it to be recalculated with extra information a couple of times).

I took the view that whatever happened it was worth it in the long run to get rid of all the debt (over £150k) and get a fresh start - at the end of the day an IPA runs for 3 years only and then you're completely done with it all.

The only people that know I've been BR are those I've shared it with - there aren't that many and those that do know have all been understanding.

rikw wrote:I would have been in a right mess, like when I had to take a pet to an emergency vet that cost a fortune, they dont allow you to have pet insurance


That's certainly not true in my case - I have a dog and outgoings are listed in my I&E for her monthly costs and also pet insurance. I did have to provide the insurance certificate/payment details for the OR, but there was no other problem with it.

Cheers
Michael
By rikw
#264933 I'm has much in the Dark regarding this with only what Ive read from other threads and the official guideline albeit old one for ORs, so am no authority on this subject, I suppose with the pet insurance question it depends on the individual receiver, in my case hopefully be a cat lover.