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

Moderators: TalbotWoods, JaneClack

BySarahM
#2794 Hi,
My husband & I are thinking of going Bankrupt. We have about £30k of debt and are unable to meet monthly repayments. We've been fighting debt for the last 10 years or so, since leaving college really.
We are currently private renting and have no assests - Overdrafts, loans, Credit Cards & a store card are why we are in debt.

We have 2 cars that are ours (not on tick or anything) 1 is worth £500 the other about £2k - both needed for getting to and fro from work.

We have 2 children (7years and 6mths)

Feeling worried, scared and confussed.

What can they take - how long can it effect us - does it really help.

Absoulty no one knows (family/friends) that were are so much in debt - in fact quite the opposite - they think were fine!!!!! :(

Do they take things from the house? what happens to renting the house - we are also thinking of applying for a council house..will the application be effected at all?
I feel really ashamed that were at this point - I so want to be resonsilbe but can't take the stress of it any more.

Any advise would be really appreciated.

Thanks.

:cry:
User avatar
ByJaneClack
#2803 You will find questions to most of these points on earlier postings but the bottom line is that if you have no assets such as a house, no HP, no restrictions as to job or rental lease, bankruptcy is a vey real option for wiping off a huge burden of debt and allowing people to start again. Leaflets on bankruptcy incluing how to go about petitioning and even the foms to do so (6.27 and 6.28) can be downloaded from http://www.insolvency.gov.uk. This is the point where you go to do your research.

You may have difficulty persuading the OR you need two cars unless it would prove impossible for one of you to go to work (i.e. no bus or train route) without them. It is unlikely they would want both though!

As it would be simple first bankuptcies for both of you I assume, you would be bankupt for one year only and may well be discharged within 6 months. If the OR feels you have enough surplus income after going through a budget sheet with you he may suggest an Income Payments Arangement which would typically use 60% of your surplus income for 36 months. However the budget sheet is generous and the majority of people who go bankrupt end up with no IPA at all.

The procedure would be to fill in the forms and go to your local county court that deals with bankruptcies - you have to attend in person - and submit the forms with the requisite monies. This is £450 at present unless you are in receipt of full benefits or on a small income in which case the court fee of a£140 would be remitted. You would then have an interview with the OR where the forms would be gone through and a budget discussed. Your bank accounts would be frozen but you can open a basic bank account the next day - we recommend the Nationwide.

It sounds worse than it is - it removes a huge burden and really does allow you to start again. Do read some of the other posts as people do kindly write and let us know and we are very grateful.

Do let us know how you get on! :)
BySarahM
#2814 Hi,
Thanks for replying.........

Unfortunatly we do need both cars as logisticly neither of us can get to work on time as well as picking up our daughter from school. We already had the £2k car but reluctently bought the £500 car due to timings with busses, start and finish times of work and school pick up/drop offs.
We didn't really want to get the 2nd car but had no option.

My worry is what can they take from the house...we don't really have anything of value, probably the PC at £600 is the most along with the norm of white goods and normal house hold goods.
You see all the info says that your allowed to keep beds, bedding etc etc...this implies to me that the take other stuff from your home.

Also...can we keep this quiet??!!?? Would we need to tell our landlady? We've been renting from her from 6 mths. We're looking for other properties cheeper ones - although this isn't regarded as expensive - quite comparitive really. As they have the intention to sell the house soon - well, put it on the market anyway.
However - do you know if it'll effect our chances of being housed by local housing corp etc.

I have read other postings and they are of help - at least I know there is a way out - it's just all to scary though.........


Still feeling swamped and lost.

S
:(
ByPineapple
#2818 It sounds like you are very worried - I certainly was, but the whole experience was nowhere near as bad as I feared.

I don't know about the cars - I was allowed to keep mine for work. No, they don't take ordinary household goods. They're only interested in antiques, valuable paintings, etc. You may need to make a case for keeping the PC. I need mine for work and didn't have to argue for either the car or PC, but was sent paperwork after my interview, stating that I could keep them.

You can't keep it quiet, but not many people need to know. There is a tiny notice at the back of your local paper and in the London Gazette, but who reads those? Sometimes landlords are written to, but mine wasn't - maybe because I took a copy of the lease to my interview. I'd forewarned them anyway and they were fine about it. I don't imagine bankruptcy itself would affect your chances of local housing corp. Your employers may guess through your tax code change. I can count on my fingers the people that know about my bankruptcy.

A couple of words of warning:

- check that your work won't be affected by bankruptcy. Some jobs, eg financial advisor, are not open to undischarged bankrupts.

- get all your utility bills and rent up to date.

- get your timing right. On payday, draw all your money out as cash. Next day, petition. Day after open new bank account and inform employer of details.
BySonic
#2819
Zadie06 wrote:It sounds like you are very worried - I certainly was, but the whole experience was nowhere near as bad as I feared.

I don't know about the cars - I was allowed to keep mine for work. No, they don't take ordinary household goods. They're only interested in antiques, valuable paintings, etc. You may need to make a case for keeping the PC. I need mine for work and didn't have to argue for either the car or PC, but was sent paperwork after my interview, stating that I could keep them.

You can't keep it quiet, but not many people need to know. There is a tiny notice at the back of your local paper and in the London Gazette, but who reads those? Sometimes landlords are written to, but mine wasn't - maybe because I took a copy of the lease to my interview. I'd forewarned them anyway and they were fine about it. I don't imagine bankruptcy itself would affect your chances of local housing corp. Your employers may guess through your tax code change. I can count on my fingers the people that know about my bankruptcy.

A couple of words of warning:

- check that your work won't be affected by bankruptcy. Some jobs, eg financial advisor, are not open to undischarged bankrupts.

- get all your utility bills and rent up to date.

- get your timing right. On payday, draw all your money out as cash. Next day, petition. Day after open new bank account and inform employer of details.


As a bankrupt, I can confirm that Zadie's advice is sound. And as she says, it's really not as bad as you might think - in fact the worse bit for me so far was what seemed like the eternal wait between petitioning and the OR interview - both of which were fine. Just be prepared - and be honest.
BySarahM
#2826 Hi,

Thank you soooo much for replying....I think doing the big B route is the only way for us - we've been fighting it for years now and we are sooo underwater its time to admit defeat I think.

:(

My next question would be.....

Realistically how long does it take..?...From getting the forms to getting it sorted?
It appears from reading other posts not that long but is it days, weeks etc etc?

So sorry to be a pain but you've really helped so far.........

Thank you
User avatar
ByJaneClack
#2833 Days.

If you have the money and have filled in the forms you could go bankrupt tomorrow. Some courts like to operate an appointment system but the bottom line is if you go to court with your forms and money and are prepared to sit there and wait and the court is running you could do it by 5.30pm tomorrow. With an appointment you might have to wait a week!

It takes as long as you take to decide to take the plunge really and as the other posters have said nothing will be taken from the property - if you do have an antique from your granny it wouldn't be there anyway and don't the children need the pc for school!

We cannot cover every question you have but get rent and utilities up to date - telephone especially as BT will not let you have another line if it is included.

Remember this iso longer a last resort but a fresh start :lol:

You have nothing to lose but your debt if none of the other
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