Debt problems

[Amethyst]

Re: Debt problems

Well I can't say much more than that. You have people here who care, never be afraid to come and rant at us, or ask for help with the tiniest thing, some of us have been where you are now and we know its not bloody easy, and we will not judge you.

Not a lot we can do with Nemo sadly the agreement is sound...so we have to go with the PPI claim for the moment. You'll be swimming against the tide till all those kick in but keep everyone informed and look forwards not backwards.

:hug:


If you cant find letters or you want help with any of them shout.

[Oldham lad]

Re: Debt problems

Ok been thinking about this (what else) for weeks now and going to try set it out in a kind of for and against Bankruptcy verses trying to deal with creditors.

If I go Bankrupt. It will cost us £850 to declare it (wife would have to do it also)

Benefits

All unsecured debt cleared
No debt collectors hassling me
After 12 months fresh start (unless I get hit for a 15 year order)

Drawback

I don’t really have £850 to go bankrupt with (possibly could get legal aid)
May Struggle to get bank accounts set up
All household bills (water, gas, electric) will have to be paid over counter
Official receiver may insist we sell house (unlikely no equity)
May struggle if ever try to rent private?
Has a stigma attached to it.
Will find credit hard to get in future (should be in benefits section)


If I try to deal with creditors (daunting prospect)

Benefits

Save £850 by not declaring bankruptcy
No stigma


Drawbacks

Will be dealing with DCA for years
Forever being chased up for bigger payments
If ever I get any decent paid work will not feel benefit
Wife will be getting same kind of hassle
Will be paying out for years
Still struggle to get credit
Would still have to change bank accounts


Ether way I have to return my van
Unemployed so IVA not possible

Even if the official receiver forces use to sell our house then the council are obliged to rehouse us due to having children and then we get a fresh start but if the PPI pays for the Nemo loan for 12 months then I’m sure that we could find enough to pay most of the mortgage then in 12 months time when we have to begin paying Nemo again if I can get a job that pays about £13 per hour (average rate for a plumber these days) then if we are careful we should manage

Just putting things down on paper Bankruptcy looks the more attractive deal in my particular case but lots of folk say its not a good idea what am I missing people?

[Amethyst]

Re: Debt problems

hang on talking with someone

[Tools]

Re: Debt problems

Hang fire with ANY decisions until we have clarified something OL please.

[Oldham lad]

Re: Debt problems

Hang fire with ANY decisions until we have clarified something OL please.

Will do Tools at the moment just voicing my idea which are to say the least vauge

[Amethyst]

Re: Debt problems

They are and very negative....which is understandable.

Okay ref bankruptcy negatives;

1: Future Credit - do you really want any more? Okay it might be 6 years before you can think on getting a new mortgage if you do lose this one and that could be a pain if things pick up quickly - other than that - credit cards you dont need them, loans you dont need them, overdrafts you dont need them. Its a lifestyle change yes, but one for the positive.

2: Bank Account - you can get a basic bank account, have main bills paid by DD if you want to, personally I find paying over the counter a lot safer and easier on a limited budget. Its no hassle either especially with paypoint in a lot of local shops. Plus no risk of charges if you just use a basic account for cash in, cash out.

PLUS you ARE changing bank accounts NOW. You are not risking the little income you do get being eaten in bank charges. Don't let DD's DO's etc start bouncing. Once you start getting charged its a vicious circle. Get them cancelled and make alternative arrangements for now until you are a bit more sorted.


3: House - this is very very complex and we're looking at options now.

4: £850 - no you are on benefits so you wont have to pay. your wife may.

5: why would renting privately be any more of a struggle than paying a mortgage, plus there council lists.

6: Not as much of a stigma as their used to be. And you do end up with a clean slate.


again just my thoughts.....for the moment.

[Oldham lad]

Re: Debt problems


Hi Amethyst

I did read on one site giving advice on bankruptcy (and I been to a few lol) that some banks will not offer you even a basic account if you have been declared bankrupt (you have to tell them by law that you are bankrupt)

Also heard that some letting rental/agencies look upon bankrupts as a bad risk due to you having no credit rating.

The reason behind my thinking that Nemo and the mortgage provider would not want a forced sale at a lower rate is obviously if they do that they lose out and eviction leaves the property empty and open to vandalism/squatters.

If the loan is protected by PPI for 12 months and I can come to some arrangement with the mortgage provider or even manage to meet the payments then they may negotiate

(TBH we been on the council housing list for nearly four years and never been offered a thing so it would suite us financially for the council to rehouse us at a cost of £250 pcm compared with what we pay now)

As for getting more credit I intend never to borrow another penny if I get out of this mess with my sanity still intact lol

Point of interest Amethyst I don’t think there is anything to stop someone to begin trading as a self employed trader immediately after they have been declared bankrupt, you can just apply to the Inland Revenue to trade under a different name unless the official receiver has ordered you not to and of course trading would be difficult without credit facilities

But trust me on this I have had a gutful of self employment and its pitfalls and do not intend to go down that road again lol

Obviously quite a lot of my thinking is trying to second guess how other people such as the official receiver/Nemo will react to the situation but I suppose I will not know that untill I hold my hand up and confess lol

[Amethyst]

Re: Debt problems

confess

There are peeps looking at your thread who know a darn site more about these things than me.

[scoobydoo]

Re: Debt problems

looks like you are gettng lots of good advice here. A good website to check out is


www.direct.gov.uk

Money section - or put in search on bankruptcy etc.

Have you contacted your bs yet - in the present climate may be they may be more understanding than you think. Beware of Nemo they have very little security and will be the most difficult to deal with. The above website may help you deal with them.

Will be back

Jan

[Guest]

Re: Debt problems

Ok been thinking about this (what else) for weeks now and going to try set it out in a kind of for and against Bankruptcy verses trying to deal with creditors.

If I go Bankrupt. It will cost us £850 to declare it (wife would have to do it also)

Benefits

All unsecured debt cleared
No debt collectors hassling me
After 12 months fresh start (unless I get hit for a 15 year order)

Drawback

I don’t really have £850 to go bankrupt with (possibly could get legal aid)
May Struggle to get bank accounts set up
All household bills (water, gas, electric) will have to be paid over counter
Official receiver may insist we sell house (unlikely no equity)
May struggle if ever try to rent private?
Has a stigma attached to it.
Will find credit hard to get in future (should be in benefits section)


If I try to deal with creditors (daunting prospect)

Benefits

Save £850 by not declaring bankruptcy
No stigma


Drawbacks

Will be dealing with DCA for years
Forever being chased up for bigger payments
If ever I get any decent paid work will not feel benefit
Wife will be getting same kind of hassle
Will be paying out for years
Still struggle to get credit
Would still have to change bank accounts


Ether way I have to return my van
Unemployed so IVA not possible

Even if the official receiver forces use to sell our house then the council are obliged to rehouse us due to having children and then we get a fresh start but if the PPI pays for the Nemo loan for 12 months then I’m sure that we could find enough to pay most of the mortgage then in 12 months time when we have to begin paying Nemo again if I can get a job that pays about £13 per hour (average rate for a plumber these days) then if we are careful we should manage

Just putting things down on paper Bankruptcy looks the more attractive deal in my particular case but lots of folk say its not a good idea what am I missing people?

The above in red is one of the most popular fallacies. If you do choose to declare bankruptcy the trustee will simply place a charge against the property preventing its sale or re-mortgage and will wait, often long after you have been discharged from bankruptcy, to realise equity gained by an increase in the capital asset due to increases in house prices.

The trustee can and will take your home and has the power to enforce the sale of the property too.

Bankruptcy really should not be considered if you have assets of any reasonable value, such as your home, even if there is little or no equity for the reasons outlined above.

Although the new Enterprise Act states that certain classifications of bankrupts may be discharged in twelve months, this is not always the case and it should be remembered that the stigma of bankruptcy still exists and will have an effect on you financially for a long period after discharge.

Long-term effects of bankruptcy are numerous not least of which is a poor credit rating, which can last as long as six or even ten years. Even when your bankruptcy is eventually cleared from your credit report, banks will still ask if you have ever been declared bankrupt whenever you apply for a loan or mortgage. This will inevitably make borrowing more expensive.

I would have to say it is worth investigating ways to avoid bankruptcy and only consider this option if you really do not have any choice and have exhausted all other avenues.

Personal bankruptcy is a difficult route and not one that should be taken lightly.

[Oldham lad]

Re: Debt problems

Thanks for the heads up Cetelco


So now I have to consider the scenario where I approach my banks, building society c/c people and explain that I am unemployed and unable to repay the debt I have borrowed

(Obviously this is after I have opened a new account and transferred all my payments from JSA in to it and assuming that Norwich union will honour the PPI)

What sort of a response can I expect from them I am thinking mainly of the Bank and credit cards because I am hoping that I might be able to meet the mortgage repayments to some extent.

I imagine that even when I am back in gainful employment once my mortgage, homeowner loan and living expenses have been deducted there will be little or nothing left to offer for paying the remaining debts

Would the creditors not just declare a bankruptcy order against me anyway and try to force the sale of the house to free the money I pay towards it so they could claim it to try to recover their losses?

If this was to happen then would my new bank account be libel to be accessed by the official receiver or even closed

just trying to cover all the bases

[Amethyst]

Re: Debt problems

You have a wife and kids and the house is your main family residence....a Judge would think very very carefully before imposing a sale order. Not saying it can't won't happen, but you have zero equity - mortgage and Nemo come first so theres not a lot to be gained by a sale order for your other creditors.

When you get new account for JSA have ctc, child benefit your wife gets put into it too.

[Oldham lad]

Re: Debt problems

we are planning to go and open a new joint bank account tomorrow with the post office or Nationwide

[Amethyst]

Re: Debt problems

brill. Nationwide is excellent - the online service for the flexaccount is really great. Post Office - I have a card account just for my benefits - you have to take an invite from the jobcentre in order to open one.

[Guest]

Re: Debt problems

Thanks for the heads up Cetelco


So now I have to consider the scenario where I approach my banks, building society c/c people and explain that I am unemployed and unable to repay the debt I have borrowed

(Obviously this is after I have opened a new account and transferred all my payments from JSA in to it and assuming that Norwich union will honour the PPI)

What sort of a response can I expect from them I am thinking mainly of the Bank and credit cards because I am hoping that I might be able to meet the mortgage repayments to some extent.

I imagine that even when I am back in gainful employment once my mortgage, homeowner loan and living expenses have been deducted there will be little or nothing left to offer for paying the remaining debts

Would the creditors not just declare a bankruptcy order against me anyway and try to force the sale of the house to free the money I pay towards it so they could claim it to try to recover their losses?

If this was to happen then would my new bank account be libel to be accessed by the official receiver or even closed

just trying to cover all the bases

It would be very rare for this type of creditor to force you into bankruptcy, their debts are are unsecured, save for the mortgage and the loan and, depending on how you inform them, you might find them reasonably accommodating.

I would not approach them with the attitude that you have lost all hope, as this is not the case at all. You have simply hit a bump in the road, it was not your fault and you will recover from it, but in the meantime, you would like their support and understanding.

Let me know if you want me to draft something. The key here is to maintain contact, tell them what is going on and they are much more likely to be flexible.