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please help! - bankrupcy
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No best answer has yet been selected by killasmile*. Once a best answer has been selected, it will be shown here.
For more on marking an answer as the "Best Answer", please visit our FAQ.Okay, this is what I think you should do.
I would urge you to contact your creditors first of all to see if they are able to assist you in any way. (eg a reduced repayment plan). I work for a bank and we always look upon customers favourably if they ask us for help first of all. At the end of the day, they want back what is owed to them! It would be foolhardy to ignore this and stick your head in the sand. You clearly wish to remedy this situation which is a vital step in the right direction.
It is important that you complete an income and expenditure for your household and take that along with you including all the debts that you have - balances, repayments and arrears etc. This is a useful tool, as it enables you to see exactly where your money is going every month. Your outgoings may exceed your incomings. From what you have said, this would not surpise me if this is the case.
Another port of call would be be the Citizens Advice Bureau. They WILL be able to help you in some way or another. Going bankrupt should only be done as a last resort as it can can have a devastating effect on your credit worthiness; notably banks and credit companies would not wish to lend you money for some years in the future. You say that your credit is already rock bottom - better to get it up quickly than to leave it where it is now!
You are still young, and you may want to get a mortgage in the future. This may still be possible if you take action, and you may kick yourself in a few years time if you did not take sort out this predicament.
So, collate all your financial affairs together, and contact your bank, your credit card loan and catalogue company. I urge you to be upfront and honest with them. You may be surprised by the outcome!
I wish you good luck. All the very best.
Hi Killasmile
Sorry to hear about your predicament, but good that you are taking steps to resolve it. As recommended previously the Insolvency Service website is an excellent source of information about bankruptcy. Since the enactment of the Enterprise Act 2002, personal bankruptcy has become a lot less unpleasant for those who find themselves in this position. There would be no problem going bankrupt for �7500 but it would be quite a drastic step to take to deal with that level of debt.
Providing you are not found to have deliberately set about running up debts and you co-operate with the Official Receiver, you should be discharged in no more than a year. It costs �450.00 for the deposit and Court Fee which might be a factor if money is already tight.
The benefits of bankruptcy are that it wipes out all your debts in one fell swoop and prevents indivdual creditors taking unpleasant action such as getting CCJ's and sending round bailiffs.
The down side is that it will be on your credit reference records for 6 years even though you are discharged after a year. This will impact on your ability to get credit or a mortgage but will not make it an impossibility. You might not be able to go to a High Street Bank for a mortgage but any mortgage broker would be able to find a lender for you. You will probably also find companies willing to give you credit cards etc but the interest rates might be higher than normal.
Whether or not you decide to go bankrupt, you should drop your debt managers immediately. Anyone who charges you a fee for this service is a shark and should be given a wide berth. Free advice and assistance is available from any Citizen's Advice Bureau and free debt management from the Consumer Credit Counselling Service, an organisation funded by the credit industry. They can be contacted on 0800 1381111 or at www.cccs.co.uk.
Hi again
An IVA is also known as an Individual Voluntary Arrangement and is a kind of voluntary bankruptcy where you reach an agreement with your creditors, via a practitioner, that they will accept so many pence in the pound.
IVA's are largely used by professionals (lawyers/accountants) who might be subject to restrictions on the work they could do if they went bankrupt. Like bankruptcies, IVA's are recorded by credit reference agencies and have a similar negative impact on your credit rating. They are also hugely expensive (several thousand pounds per year in practitioner's fees, normally over a term of five years) hence their main usage being by professionals with large incomes. Based on what you say about your circumstances I wouldn't recommend an IVA due to their cost, in addition, a lot of them fail as people's circumstances change over the five year term.
HI there i hope you are well... I can only tell you what i know from my experience. I was self employed for a few years but i ran up debts of around �20,000 and i dont just mean suppliers. Mobile phone store cards and credit cards etc etc....I tried to pay them off but it was hard. I woke up every day with a headache. So i know its hard no matter what amount you owe.
My solution was bankrupcy. In fact it was my only solution.It cost me nothing to do it and in one go all my money worries where over and i could start afresh.
Its true its hard to get credit after it but if your smart you can. It just takes time and patients.. If you have no assets then dont worry about it.. Just do it and when its over i gaurantee you will wake up in the mornings with the headaches gone for good...........
Feel free to contact me [email protected] where if you like i can discuss my services further. Remember i have been through this myself so i know what im talkin about...
Regards
Martin...