This is why this country is in such a mess. People can spend tens off thousands that isn't theirs, go bankrupt and have it all wiped out, then just six years later start all over again, get a mortgage etc.
Bankruptcy can be relatively painless if you've nothing to lose, but if you own a property with equity, run a business etc it can be a nightmare, and can turn your life upside down. So not always the easy way out. It's different for everyone.
I think you have to open another basic account, without overdraft facilities etc.
The Co-op do one and I believe Barclays do one to.
I believe that all banks are (possibly legally) obliged to allow you a basic bank account, they just don't advertise the fact!
For example, if two of your creditors are Barclays or Co-op then you're screwed if they are the only ones available because you cant bank with a creditor!
I believe that all banks are (possibly legally) obliged to allow you a basic bank account, they just don't advertise the fact!
For example, if two of your creditors are Barclays or Co-op then you're screwed if they are the only ones available because you cant bank with a creditor!
It's the biggest stumbling block for people looking to go bankrupt. I believe the bank account issue is something that the government are looking at as part of wider insolvency reforms due next year.
It's the biggest stumbling block for people looking to go bankrupt. I believe the bank account issue is something that the government are looking at as part of wider insolvency reforms due next year.
Also, I understand that with a basic bank account, the sanctions can be quite draconian! For example, if someone is going bankrupt and are trying to sort out their finances (I would hazard a guess that a large number of people with money issues have money management problems) and they inadvertently go overdrawn ie not recklessly, then these banks can simply close your account leaving people with even fewer options!
Also, I understand that with a basic bank account, the sanctions can be quite draconian! For example, if someone is going bankrupt and are trying to sort out their finances (I would hazard a guess that a large number of people with money issues have money management problems) and they inadvertently go overdrawn ie not recklessly, then these banks can simply close your account leaving people with even fewer options!
They're not any more draconian for a bankrupt than for anyone else using a basic bank account, and some of them do have a £10 'buffer' before levying charges.
It's just stupid full stop that people have issues with bank accounts in bankruptcy! The accounts are frozen so that the official receiver can check what money is in there, but there's better ways of checking nowadays. It just seems rather archaic to deal with it that way and cause people such hassle. It's an issue I come across a lot in my job and it's very frustrating!
My friend has gone bankrupt twice and she isn't even 40 yet.
The first time was before I met her, in her early twenties, I've known her 10 years and the second time is this year. She was taking out payday loans on top of payday loans and ran up about £7k in two years. The thing is, she has a champagne lifestyle on a bucks fizz wage and doesn't look upon bankruptcy as a bad thing, she sees it more of a weight off her shoulders. I'd be ashamed!
Individual Voluntary Agreements, a bit like bankruptcy but not so extreme. Your CAB will be able to talk to you about your options.
As others have suggested, check any employment contracts you have - you can be dismissed for declaring bankruptcy. Many companies will not take you on if you are an undischarged bankrupt, either.
Individual Voluntary Agreements, a bit like bankruptcy but not so extreme. Your CAB will be able to talk to you about your options.
An IVA isn't really an option for the OP due to the level of his surplus income and debts. You really need to have at least £100 a month available and be able to give your creditors at least 10p/£ for an IVA to be accepted. The OP would only be able to return about 4p/£ based on his current circumstances.
My friend has gone bankrupt twice and she isn't even 40 yet.
The first time was before I met her, in her early twenties, I've known her 10 years and the second time is this year. She was taking out payday loans on top of payday loans and ran up about £7k in two years. The thing is, she has a champagne lifestyle on a bucks fizz wage and doesn't look upon bankruptcy as a bad thing, she sees it more of a weight off her shoulders. I'd be ashamed!
Once is a lesson learnt, but twice i do think is people taking the mick!
Bankruptcy really should be a last resort and 25k isn't that massive a debt.
Is £45 a month really the most you can afford? A decent debt management company should be able to reduce the repayable amount down to about 15k, so if you could manage say £150 a month you could clear the debt in 5-6 years.
If £45 really is all you can afford then even with debt management you will still be looking at 15+ years so in that case bankruptcy may be the best option for you.
My friend has gone bankrupt twice and she isn't even 40 yet.
The first time was before I met her, in her early twenties, I've known her 10 years and the second time is this year. She was taking out payday loans on top of payday loans and ran up about £7k in two years. The thing is, she has a champagne lifestyle on a bucks fizz wage and doesn't look upon bankruptcy as a bad thing, she sees it more of a weight off her shoulders. I'd be ashamed!
I think deliberately running up debts with the intention of avoiding paying them back should be classed as fraud.
Especially if the application form has a question "have you ever been bankrupt?", and she answers "no".
My friend has gone bankrupt twice and she isn't even 40 yet.
The first time was before I met her, in her early twenties, I've known her 10 years and the second time is this year. She was taking out payday loans on top of payday loans and ran up about £7k in two years. The thing is, she has a champagne lifestyle on a bucks fizz wage and doesn't look upon bankruptcy as a bad thing, she sees it more of a weight off her shoulders. I'd be ashamed!
I didn't think the court allowed you to go bankrupt for such a small amount. Aren't Debt Relief Orders more appropriate?
I think deliberately running up debts with the intention of avoiding paying them back should be classed as fraud.
Especially if the application form has a question "have you ever been bankrupt?", and she answers "no".
Do application forms ask that question or do they ask if you are an undischarged bankrupt? At the end of the day, they will look at someone's credit report and bankruptcy will be there as plane as day so asking such questions are a bit pointless!
One thing I've wondered is that should someone file for bankruptcy and they're asked the question "have you ever been declared bankrupt?" could they just answer 'no' after 6 years?
One thing I've wondered is that should someone file for bankruptcy and they're asked the question "have you ever been declared bankrupt?" could they just answer 'no' after 6 years?
I'd have thought no, because it would say "have you been declared bankrupt in the last six years" rather than ever.
One thing I've wondered is that should someone file for bankruptcy and they're asked the question "have you ever been declared bankrupt?" could they just answer 'no' after 6 years?
If you are a discharged bankrupt you are no longer bound by the bankruptcy and after 6 years it drops off your credit report so it'll no ones business but yours. You could lie and say no and they would never know! I would say that they couldn't ask that question anyway!
If you are a discharged bankrupt you are no longer bound by the bankruptcy and after 6 years it drops off your credit report so it'll no ones business but yours. You could lie and say no and they would never know! I would say that they couldn't ask that question anyway!
One thing I've wondered is that should someone file for bankruptcy and they're asked the question "have you ever been declared bankrupt?" could they just answer 'no' after 6 years?
They could lie, but the official receiver would find out anyway because the insolvency service will have a record of the previous bankruptcy, regardless of when it was. The OR would then probably question what else the debtor was lying about and give them a grilling.
The OR takes a pretty dim view of second bankruptcies nowadays. The debtor would probably end up with a bankruptcy restrictions order, which can extend the usual bankruptcy restrictions for anything up to 15 years.
Bankruptcy really should be a last resort and 25k isn't that massive a debt.
Is £45 a month really the most you can afford? A decent debt management company should be able to reduce the repayable amount down to about 15k, so if you could manage say £150 a month you could clear the debt in 5-6 years.
If £45 really is all you can afford then even with debt management you will still be looking at 15+ years so in that case bankruptcy may be the best option for you.
Yes its all i can afford at present im hoping i can up payments and avoid bankruptcy. How does a debt management get payments down? Im with stepchange. I thought nothing can come down just gotta owe what u owe.
.......... How does a debt management get payments down? Im with stepchange. I thought nothing can come down just gotta owe what u owe.
A debt management company (or indeed you yourself) can negotiate with the creditor over the amount of the debt. The creditor then has a choice - a lower amount, repaid over a long period, or sell the debt for about 10p in the £.
You can also negotiate the amount of the monthly payment, but it can reach a point where it costs the creditor more in admin than they're receiving.
I have read online the restrictions ect that can be placed on you but I would like to know from a person who has been through it what it entails - was it worth it - and what is life like now.
i dont own a home i dont have any assests at all really, no car , just basic house things which ive read they have to allow you to keep in order for you to carry on with your life.
My sister was like you when she went bankrupt in 2009; didn't have any assets. It also didn't cost her a penny to go bankrupt (she is mentally disabled with disability benefits being her only income, so I think that's why the court and their appointed lawyer took no fees). She had three sessions in court.
She was discharged from bankruptcy three years ago. We still get unwanted phone calls from debt and loan companies, but block them where possible. I have not yet switched home insurance because many of them now ask if anyone in the household has ever been made bankrupt (which is annoying for us as a family, because the rest of us are careful with money). Her bank account was closed by the bank, but Clydesdale opened one up with a debit card no problem. However they regularly let her go overdrawn by as much as £150 a time at no charge (not even debit interest), knowing she had a regular "income", which was like giving alcohol to an alcoholic. Just last month I persuaded her to open a cashcard account with Barclays where I hope she will finally be able to learn to manage her money sensibly, without temptation.
I wouldn't recommend bankruptcy to anyone. Even those who apparently have no risks can be affected for years afterwards - and their families.
A debt management company (or indeed you yourself) can negotiate with the creditor over the amount of the debt. The creditor then has a choice - a lower amount, repaid over a long period, or sell the debt for about 10p in the £.
You can also negotiate the amount of the monthly payment, but it can reach a point where it costs the creditor more in admin than they're receiving.
Well the debt management company i used to work for did it like this...
You would completely stop paying your creditors and instead pay the maxiumum you could afford to us each month. We would then pay each of your creditors the minimum we could, normally £1 a month each. We would save up all the cash you gave us.
We would then wait until we had built up a decent amount and try and settle one of your debts with the creditor. For example if you had a 5k debt we would offer to settle it for 2.5k. Most of the time the creditor would accept this as the alternative would mean just continuing getting £1 a month and the debt never being repaid.
We would then take a fee of say £500 when we settled the debt. So you saved £2k. We made £500 and the creditor got its debt settled. Everyone wins.
I can PM/post the company if anyone is interested..
I have not yet switched home insurance because many of them now ask if anyone in the household has ever been made bankrupt
I don't understand how a discharged bankrupt presents more if a risk when taking out insurance? You either pay an annual or monthly fee to insure building and contents, how does being a discharge bankrupt make any difference? The only thing I can think of is that it means that you cant pay monthly, but that would normally show up on a credit check anyway!
Comments
Bankruptcy can be relatively painless if you've nothing to lose, but if you own a property with equity, run a business etc it can be a nightmare, and can turn your life upside down. So not always the easy way out. It's different for everyone.
I believe that all banks are (possibly legally) obliged to allow you a basic bank account, they just don't advertise the fact!
For example, if two of your creditors are Barclays or Co-op then you're screwed if they are the only ones available because you cant bank with a creditor!
It's the biggest stumbling block for people looking to go bankrupt. I believe the bank account issue is something that the government are looking at as part of wider insolvency reforms due next year.
Also, I understand that with a basic bank account, the sanctions can be quite draconian! For example, if someone is going bankrupt and are trying to sort out their finances (I would hazard a guess that a large number of people with money issues have money management problems) and they inadvertently go overdrawn ie not recklessly, then these banks can simply close your account leaving people with even fewer options!
They're not any more draconian for a bankrupt than for anyone else using a basic bank account, and some of them do have a £10 'buffer' before levying charges.
It's just stupid full stop that people have issues with bank accounts in bankruptcy! The accounts are frozen so that the official receiver can check what money is in there, but there's better ways of checking nowadays. It just seems rather archaic to deal with it that way and cause people such hassle. It's an issue I come across a lot in my job and it's very frustrating!
The first time was before I met her, in her early twenties, I've known her 10 years and the second time is this year. She was taking out payday loans on top of payday loans and ran up about £7k in two years. The thing is, she has a champagne lifestyle on a bucks fizz wage and doesn't look upon bankruptcy as a bad thing, she sees it more of a weight off her shoulders. I'd be ashamed!
Individual Voluntary Agreements, a bit like bankruptcy but not so extreme. Your CAB will be able to talk to you about your options.
As others have suggested, check any employment contracts you have - you can be dismissed for declaring bankruptcy. Many companies will not take you on if you are an undischarged bankrupt, either.
An IVA isn't really an option for the OP due to the level of his surplus income and debts. You really need to have at least £100 a month available and be able to give your creditors at least 10p/£ for an IVA to be accepted. The OP would only be able to return about 4p/£ based on his current circumstances.
Once is a lesson learnt, but twice i do think is people taking the mick!
And giving people like us a bad name
Is £45 a month really the most you can afford? A decent debt management company should be able to reduce the repayable amount down to about 15k, so if you could manage say £150 a month you could clear the debt in 5-6 years.
If £45 really is all you can afford then even with debt management you will still be looking at 15+ years so in that case bankruptcy may be the best option for you.
I think deliberately running up debts with the intention of avoiding paying them back should be classed as fraud.
Especially if the application form has a question "have you ever been bankrupt?", and she answers "no".
I didn't think the court allowed you to go bankrupt for such a small amount. Aren't Debt Relief Orders more appropriate?
Maybe it is a debt relief order... She referred to it as bankruptcy though.
Do application forms ask that question or do they ask if you are an undischarged bankrupt? At the end of the day, they will look at someone's credit report and bankruptcy will be there as plane as day so asking such questions are a bit pointless!
I'd have thought no, because it would say "have you been declared bankrupt in the last six years" rather than ever.
If you are a discharged bankrupt you are no longer bound by the bankruptcy and after 6 years it drops off your credit report so it'll no ones business but yours. You could lie and say no and they would never know! I would say that they couldn't ask that question anyway!
Never heard of the London Gazette:rolleyes:
They could lie, but the official receiver would find out anyway because the insolvency service will have a record of the previous bankruptcy, regardless of when it was. The OR would then probably question what else the debtor was lying about and give them a grilling.
The OR takes a pretty dim view of second bankruptcies nowadays. The debtor would probably end up with a bankruptcy restrictions order, which can extend the usual bankruptcy restrictions for anything up to 15 years.
Actually I misread the question! And yes, I have but thanks anyway!
Yes its all i can afford at present im hoping i can up payments and avoid bankruptcy. How does a debt management get payments down? Im with stepchange. I thought nothing can come down just gotta owe what u owe.
A debt management company (or indeed you yourself) can negotiate with the creditor over the amount of the debt. The creditor then has a choice - a lower amount, repaid over a long period, or sell the debt for about 10p in the £.
You can also negotiate the amount of the monthly payment, but it can reach a point where it costs the creditor more in admin than they're receiving.
She was discharged from bankruptcy three years ago. We still get unwanted phone calls from debt and loan companies, but block them where possible. I have not yet switched home insurance because many of them now ask if anyone in the household has ever been made bankrupt (which is annoying for us as a family, because the rest of us are careful with money). Her bank account was closed by the bank, but Clydesdale opened one up with a debit card no problem. However they regularly let her go overdrawn by as much as £150 a time at no charge (not even debit interest), knowing she had a regular "income", which was like giving alcohol to an alcoholic. Just last month I persuaded her to open a cashcard account with Barclays where I hope she will finally be able to learn to manage her money sensibly, without temptation.
I wouldn't recommend bankruptcy to anyone. Even those who apparently have no risks can be affected for years afterwards - and their families.
Well the debt management company i used to work for did it like this...
You would completely stop paying your creditors and instead pay the maxiumum you could afford to us each month. We would then pay each of your creditors the minimum we could, normally £1 a month each. We would save up all the cash you gave us.
We would then wait until we had built up a decent amount and try and settle one of your debts with the creditor. For example if you had a 5k debt we would offer to settle it for 2.5k. Most of the time the creditor would accept this as the alternative would mean just continuing getting £1 a month and the debt never being repaid.
We would then take a fee of say £500 when we settled the debt. So you saved £2k. We made £500 and the creditor got its debt settled. Everyone wins.
I can PM/post the company if anyone is interested..
I don't understand how a discharged bankrupt presents more if a risk when taking out insurance? You either pay an annual or monthly fee to insure building and contents, how does being a discharge bankrupt make any difference? The only thing I can think of is that it means that you cant pay monthly, but that would normally show up on a credit check anyway!