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- Fri Feb 25, 2005 5:07 am #4221 Hi! Thank God I found your website online this morning! The amount of issues you cover is excellent.......!!

I'm considering going bankrupt as I can't meet up with my payments anymore....totalling £50k. However, I still need some clarification on a couple of issues:

1) I'm a final year, full-time student who works full-time hours. I know my student loans won't be written off by bankrupcy but what would my financial stance be during the one year, that I'm bankrupt and after the discharge?


2) What happens to my income during the 1 year of bankrupcy? Is it assessed every month?

3) What happens to my income AFTER the 1 year of bankrupcy discharge? Will my income still be assessed after the discharge after 1year (as the bankrupcy is still going to be on my credit file for another 5 years)....or will I be home free ?

4) Assuming I go bankrupt now and currently earning £1000, then get a graduate job in July earning £1500 a month, will the extra £500 be 'taken off' me as contribution to my creditors?

5) In 4) above, if it will be used towards my debts, will this cease after the discharge @ the end of year 1?

6) If, for example, from the scenario above I get a raise or promotion to £2500 two months AFTER my discharge what happens to the extra cash I'm earning?

Thanx for your feedback in advance!

[JaneClack]

- Fri Feb 25, 2005 12:06 pm #4231 Right - if you were to go bankrupt now the budget you provide would be gone through at the interview with the OR. Then if there are no changes it remains in force. If there are any changes in circumstances - pay rises, stupidly working overtime!, change in rent etc - you have a duty to inform the Official receiver within 21 days. If an Income Payments Arrangement is set up then this will continue with any changes for three years. If none is set up and nothing happens before discharge which could be in as little as six months but may be the whole year depending on busyness of office, then nothing can be set up and you are, in your own words, home free. Except for the student loans as you know.

When you work out your budget if there is any surplus the OR would want between 50% and 70% of it but he is quite generous in his allowances - you must put down what you spend but leisure doesn't go down a bomb!!

- Sat Feb 26, 2005 4:25 am #4271 Thanx a mill for the feedback!