Should I go bankrupt?

[serendipity2]

Hi, I am a lone parent on benefit, but my children are now old enough for me to consider going back to work, which I would love to do. The problem is, I have debts in excess of �15,000. At present, the companies I owe money to are accepting a minimum repayment from me of between �1.00 and �10.00 per month. As soon as I start work though I have been told that these companies will then require me to pay the original agreed repayments...this would be awful as then I would be in worse financial trouble than I am now! I wish someone could just wave a magic wand and take this all away from me but until that happens the only thing I can think of is to go bankrupt as I could them make a fresh start. I know I would then not be able to get credit for a very long time but I really do not care as I would never have it again anyway. Please could somebody help me as I need to be sure that I am doing the right thing for myself and my children...thank you x

[purplelily]

I'm not sure that these companies would expect you to start paying different amounts; I think it might be worth getting some more advice on that - maybe from the CAB?

I think that, as you owe more than �15K, you should visit debtfreedirect.co.uk - this is a scheme which helps you deal with and pay off your creditors. They won't charge you for their services. I wouldn't personally recommend bankruptcy.

I think it's fantastic that you're looking to rejoin the workforce, and wish you all the very best of luck. xx.

[khana]

I think you have been misinformed. The companies involved will of course whant increased payments, however, it will be proportional to the income you are earning.

Go back to work and then when you know what you will be earning then contact the companies involved to explain your new situation and to offer them increased repayments.

I sympathise with people who get in to debt, but its good that you are making efforts to repay and not default or go bankrupt. It says a lot about your character as i'm sure its not been easy for you with children to bring up by yourself.

[Kathyan]

I think you have to pay a charge to go Bankrupt and I think it's in the region of �450. Debtfree Direct do charge a fee if they arrange an IVA. It's in the region of �4000, but is paid by the creditors out of what the get back from you. Please beware of anyone wanting upfront charges before they advise you. Hope you get things sorted, I've been there and it's not easy. Good luck!

[garagemanc]

Hi, if you do not want to bankrupt then there is an alternative called an IVA, you make a legal agreement with your creditors to pay the money back over 5 years. The interest and charges will stop if it is agreed. You can go through companys who do this and pay them a fee or do like i did and go straight to an insolvancy practisioner and they will look at you circumstance's. there are fees involved but nothing you have to pay upfront. The one i used was called Haines Watts. I thought of going bankrupt but this seemedd the best option all round, hope this helps and good luck with wot you decide to do!

[gammaray]

You can go to your local county court and fill in a form, pay the court fee (approx �450) see the judge, he makes the order and Bob's your uncle - your nightmare has just begun! Not only will you not be able to get credit but the office of the official receiver will freeze your assets (which include any bank accounts). Your bank will withderaw and credit facilities you currently rely on (overdraft etc) and may decide to close your account. With the OR's permission you will be allowed to open a cash account but it's operation will be severely restricted. for example even though you will be given a cash point card it will only work in your own banks machines, meaning you'll need to make a special trip every time you want to get any money. Bankruptcy isn't a way of avoiding repaying debts - just a way of stopping them getting bigger. If you are working you will be required to make a reasonable contribution to repay the debts, and even though bankruptcy only lasts 12 months (assuming you don't abuse the terms set out by the OR) the OR can make a repayment order to the creditors lasting three years.

If you already have an agreement with your creditors I advise you to stick with it. If you get a job they can't just ramp up the repayment requests out of proportion with your new income. However it has to be said the more you pay the quicker you become debt free.

[fayelc123]

HI serendipity2,

I would consider an IVA as other people have suggested. Although, i was shocked to hear that kathyan said Debtfree Direct charge for this!!!

I am going through an IVA myself & it was the best decision i ever made & i did not have to pay to do this.

The compnay i spoke to was Thomas Charles, they offer free advice & they was so friendly & helpful.

www.thomascharles.com or call them on 0800 072 5988.

[flipflop104]

Try www.cccs.co.uk - these helped my family out when they were in trouble and were very helpful. They are a charity so will not charge you a penny.

[1carazy675]

Hi, thank you to you all for your advice! I think i will try CCCS first, which flip flop told me about x

[serendipity2]

Thank you for that Mdoo...would you be able to tell me if there is anything i should be aware of if i go bankrupt. I am scared about certain things such as whether or not they can take posessions from me to go towards the debts etc. I suppose I should really see CAB but the last two times I have rung them I have had an elderly lady telling me stuff out of a book and she really didn't seem certain of anything. She also told me it should be the LAST thing I do as it is a very unfavourable option.

[Susan ann]

Hi my heart goes out to u I know how u feel I was left with about 22,000 worth of debt when I divorced my ex . I tried to make ends meet, having 3 kids at home at the time.I was making myself ill with worry.I got in contact with the c.c.c s they were great. They ring u back and chat to u for about 1hour and go thru all ur options,my only way out was to declare my self bankrupt.I did that of May last year it was the best thing that I ever did.The courts and the Official Recievers were fantastic they are there to help u all the way. The only problem that u may have is finding a bank account afterwards. As u cant have a bank account when u declare ur self bankrupt.Do u have any assets property savings etc as this may be taken from u. If u have no assets like myself its a huge relief. as they take over all ur creditors for u. I have my wages and all other bits paid into my new husbands account.And yes if ur financial situation does change ur creditors may want u to up ur money.If u need to get back to me please do best wishes sue

[serendipity2]

Thank you Susan, that has helped me a lot. I was just driving back from school thinking that bankruptcy is my only option. I have not been well lately, problems with my heart, and the doctor said it could very well be down to stress. I now need to know how to go bankrupt as I haven't a clue where to start. I would appreciate it if you could let me know what to do next. Thank you again x

[Susan ann]

hi I was glad to have been of some help to you, I know that its not going to be an easy thing to do. But it is a way of starting a fresh.U will need to contact ur local County Court and ask for the Bankrupcy section and explain to them what u want to do.Ask about the costs, if u are on benefits them the cost will go down to declare urself bankrupt.They will ask u when u want to do this and arrange a date for u. I did try and apply for an IVA before hand but what u have to remember is that once u have signed the dotted line u are expected to pay that same payment every month for 5 years and if u fall behind with the payments then ur creditors can bankrupt u. this is what they told me. And u never know whars round the corner in 5 years time, hence why I didnt do it.U should have a chat with the credit comsumer councilling services they are fantastic, i think i have that the correct way round!And they dont charge u a penny.They will work out all of ur money and tell u your best course of action also. But when u go in to declare ur self banrupt u must not have any kind of bank account. This may pose a problem after for a while. I went thru this worry for 5 years and i dont regret what i did.Best wishes if u need more help just say.

[007007]

hiya. i'm just going through bankrupcy now. you can have a bank account so no problem there, although the basic form type. best one is natwest where you get given a solo debit card. i have one now. don't worry, it's all quite straight foward and the court wont treat you like a criminal. i owed 250000. i am much better person now, more time for kids, wife etc. if you need any more help, let me know. i'll guide you thourgh. hope your ok, just dont worry, honestly, theres no need to. everyone, and i mean everyone will leave you alone and the phone will stop ringing when you go bankrupt. as long as you can accept the downsides, the upsides are tremendous! chip up!