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

Moderators: TalbotWoods, JaneClack

By mumuplate
#4340 Hi - new to the forum and wondered if anyone can help me out? Would be much appreciated.

Basically, myself and my partner are way in over our heads in debt. By that I mean somewhere in the region of 50k I would think although have so much paperwork kicking around I dont have a running total. When taking on these debts (havent taken on anything new in about 2yrs now, they are all older debts), we both worked full time. Now, we have a 2yr old, a baby due in 2 weeks time, I am on maternity leave from my part time job, and my partner also only works part time now due to ill health and childcare problems.

Our home is being reposessed, although we havent had a date to be out by. We have been lucky and managed to get a house thru the homeless route at our local council, which we are currently decorating like mad in order to move into it before baby arrives.

The debt advisor at the council has most of the paperwork from all our creditors now, and has basically been putting most of them off by telling them about the reposession, baby due etc, and that she will get back to them when we are settled and know our income/expenditures etc. This has kept some of them at bay, but others have taken it thru the courts. We have completed Time To Pay orders for the ones gone thru court, some have been accepted, some have refused what we have offered and dates of hearings have been set etc. (one of them being my due date )

The debt advisor is coming up to visit us on thursday to discuss options, but the way she is talking she seems to think we should file for bankruptcy. I know she will be able to tell us the ins and outs of it all, but want to kind of have some info to hand before we see her, so we know more of what it involves.

The creditors who have accepted the Time To Pay offer - would we still need to stick to these if we went bankrupt, or would bankruptcy cancel these out? The hearings for the ones who have refused the offers - do we have to attend these hearings? What can they decide without us being there?

Between us, once I return to work after maternity leave, I would expect us to have an income per month of around £1000. The only other income on top of this would be child benefit (about £110 with 2 kids) and tax credits (£45 a month due to repaying overpayments to them.) How much would we have to pay each month being bankrupt? Do you still pay creditors or does the money go elsewhere? Can you go bankrupt if you have no money, or very little, to pay towards it per month? Will it affect our jobs?

Sorry its a bit mumbo jumbo but trying to sort my head out here which isnt easy, esp. with a belly this size!!

Hope someone can help, and thanks xx

edited to add - I'm in Scotland if that makes a difference to anything above?
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By JaneClack
#4346 Yes, it does as the rules are different but the basics remain the same - all your debt, those with time to pay orders on, the mortgage shortfall from the house - everything is wiped off at the time you go bankrupt.

You will have expenses you have to make so even when you do go back to work - think of childcare etc - you should not have a lot to pay! Go to http://www.nationaldebtline.co.uk where there is a fact sheet on sequestration that you can read.

You will probably be surprised at the relief it brings - no more hassling phone calls, no more dreaded clicks of letter box. It will be a fresh start for you both!
By Freedom_at_last
#4367 I went bankrupt about 17 months ago and will be discharged on 1.4.05! I was really dubious about doing it, what with all the 'stigma' etc. But it's the best thing I have ever done. I am sure anyone else who has gone through bankruptcy would tell you the same. It is a very daunting prospect but believe me - the feeling of all that weight released from your shoulders is the best feeling in the world! And you are allowed a new fresh start to begin living your life, instead of enduring it! :lol: