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

Moderators: TalbotWoods, JaneClack

By snoopy
#4672 As we all know things are NEVER straightforward! Any comments on the following would be grateully received.

I've established a very good rapport with my personal bank manager. I've just been put on a Managed Account which means I have a Solo card, no overdraft and am paying the outstanding £13,800 off at £280 a month for the next 7.5 years at 23%! I won't be able to make the first payment, due next week and asked him for an extra month's holiday from payment. he said not possible as he's already given me a month extra.He did say though that I should walk away from it.... I should write a letter saying I can't afford the re-payment, tell them what I can afford - like a DMP. I should expect for it to be passed onto debt collector, for it to get a little nasty but ultimately that it will be written off, that I will be black listed for 6 years but then it will all be OK again. I was gobsmacked to say the least when he suggested this - he said the bank can afford it and that he reckons I should do it.

Now, I need to know the implications as I'm still a company director in a business that someone else is now running for me while I find a Salaried job to get some money behind me again. If I was to be blacklisted, I don't know if this will affect my position as a Company Director or not, does anyone know? The Bank Manager seemed to think it wouldn't be a problem but I simply don't know.

It really is all so confusing and worrying never mind stressful!

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By JaneClack
#4676 It won't be written off I can assure you unless you are 87 and terminally ill. Why would it be - you are earning and can afford to pay it back albeit at a lower rate.

You can of course go for debt management and this may well be the route to follow but you must include all your debts not just the ones to the bank.

The only way the debt will be written off is in bankruptcy which is NOT a good idea if you are a director of a limited company. As a bankrupt you cannot be a company director.
By snoopy
#4680 Thanks Sarah. All my debt is with that bank so perhaps the DMP is the way to go, it won't affect my status as a company director and I presumably won't be blacklisted? If I keep it above board it must be better than trying to just walk away from it and 'play the system' in his words?! I won't deny it is something that is extremely inviting to do but without knowing all the implications really perhaps a stupid thing.

Is Payplan or CCCS the better company? Although, because the debt is with the same creditor will that not make it more difficult to do through DMP as I've investigated this in the past?
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By JaneClack
#4686 If all your debts are with one creditor then no DMC could take you on - one creditor prefers that you deal with them directly as there is no negotiation needed. You do your income and expenditure and what is left over is what you can afford the creditor.

Both CCCS and Payplan work in the same way - they charge no fees as they are sponsored by a number of the creditors. Payplan make pro-rata payments like the CAB and CCCS seem to make payments related to the contractuals - both systems work. You pays your money and you takes your choice! :wink: