question for saxy jag about bankcrupcy

[wonderwoman1]

hi saxy jag(or anyone else that can help me!)

i understand you have been through bankcrupcy before, i myself am thinking about going through this to clear my debt. i have been with a debt consolidation company for 3 yrs, paying a ridiculous amount per month and it doesnt seem to be making a dent in my debt. i dont own a house as i rent, and i dont own a car. i dont have any CCJs on my debt. i am thinking of buying a house but i have been told it can take up to 16 yrs before i can get a mortgage after bankcrupcy...is this true? can you also explain to me the ins and outs of bankcrupcy as i'm still not 100% sure this is the way to go.

thanks so much for any info, anyone can give me...i'm a bit stressed out about it and just dont know what to do.

thanks again in advance

xx

[SaxyJag]

We did it ten years ago, so I don't know whether it's changed or not. The first thing I did was to call a private insolvency practitioner. She did explain that they usually only deal with company debts, but spent a long time with me on the phone going through the whole thing.

You basically go through the court (there's quite a hefty fee). You have to fill in forms and declare all your assets and liabilities etc., and then you meet with a court representative who sets everything in motion. You'll have to swear on oath like in court, but it's just in a small office and very discrete.

Then it has to go before a judge who decides whether or not to grant the bankruptcy order. He'll have a chat with you before he makes his decision. That decision will rest on the size and nature of your debts. If he does grant it, then you have to go the insolvency service where they sort out all the administrative stuff. Your name will appear in the newspaper, I'm afraid, on the page where all the bankruptcy and liquidation notices are printed. Discharge is automatic after two years unless you get into any more trouble in that time. You don't usually get a discharge notice unless you ask for one.

[SaxyJag]

and more...

The bankruptcy will show up on credit checks and you're legally obliged to declare it. It doesn't mean you can't get credit, but it will make it difficult.

I don't know about mortgages, because we've lived in rented ever since and I'm quite happy about that (I'm a bit of a Wemmick - portable property and all that). We still have difficulty getting credit, but then we've had an armful of CCJs etc since then (council tax etc), so that could be the reason rather than the bankruptcy.

Nowadays we don't even apply for credit. If we can't afford, we don't have, full stop. Sometimes that means buying secondhand or waiting a little longer, or putting in a few hours overtime, but we have the satisfaction of knowing that what we have is ours outright. Our lifestyle has become a lot less material than it used to be (actually, we're poor as church mice), but somehow it's easier. We don't have to worry about getting caught up in air traffic control disputes on holiday, or how we're going to replace the second car this year. Funnily enough, we have nicer friends now as well.

That's about all I can tell you. I'm not sure where you'd go for 'proper' advice, but the offices of the local crown court might be a good start. They may at least be able to point you to the right people.

Good luck.

[SaxyJag]

I should have said - all that court stuff happens in the same day, so if you go for it, take a couple of days off work to do it.

[SaxyJag]

Still more (sorry, I can't edit with Mozilla).

Try here:

http://www.insolvency.gov.uk/

[wonderwoman1]

thanks so much saxy-jag....you've been a great help....i will let you know how i get on.
xx

[themas]

As well as getting info from insolvency service site you can talk to a free debt service such as CCCS or National Debtline, or go to your local CAB. Whatever you do, do get away from a fee paying debt company!

Unless there are particular problems (dishonesty etc.) you are now discharged after at most 12 months. The cost is �475 but you might be exempt from �150 of this if on certain benefits or a very low income.

Do not even think about buying a house until 3 years after becoming bankrupt. The law on this is somewhat confusing but it is possible that if you bought before 3 years are up the insolvency people could treat the house as an "after acquired asset" and come after it. When the time comes you should (subject to income etc.) be able to get a mortgage - but at a higher than normal interest rate and through a broker rather than a high street lender.

If your expenditure statement has been screwed right down tight by the debt management co. you will likely find the Official Receiver rather more generous but it is advisable to get independent input on the sort of expenses that might be allowable before you do the statement of affairs.

[themas]

Another point. Any bank account you have is frozen when you go bankrupt. So make sure no money you will need for living expenses is in it, & that your pay, benefits etc. will not be paid into it (arrange for them to go into a relative's or friend's account before you go bankrupt). After you are bankrupt you can open a basic bank account with one of the few banks that do them (Nationwide, Co-op, Barclays) provided you don't owe them any money.

[wonderwoman1]

thank you all so much for your advice...i was worried sick about what i should do. i went to the CCCS when my debt started but they couldnt help me, instead they passed me onto this debt management company who, at the time, i thought were fantastic...but 3 yrs on and it hasnt made a difference to my total debt!

anyway, my accountant is coming to see me tomorrow to get the ball rolling...thanks again to you all xx

[myvesta-sean]

Hi wonderwoman1,
The Myvesta Bankruptcy video clips will assist you with your questions. I have attached the link below:

http://myvesta.org.uk/media/video/bankruptcy/i ndex.html

Regards

Sean