Author Topic: 2015 is going to be my year of bankruptcy - What is the best way to manage it?  (Read 18470 times)

Tom2015

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Both my wife and I are in business - both as single person Ltd companies. Whilst the companies do not yet owe money aside from £5K bank overdrafts we personally have accumulated personal debit of approaching £100K - nearly all of which is on credit cards.


Most of our issues can be traced to a company I was contracting to going bust and owing us £50,000 at the same time as the property market going backwards right whilst we were in the middle of a budget stretching renovation. Over the years we just never seem to have broken the back of credit card debts and they have simply grown year on year. Thus far we have always maintained payments, however both our businesses are struggling and I am projecting that we will run out of money in the next 12 months and there seems to be no magic solution to solving the issue. There are also taxes soon due and we have no provision to pay HMRC the £20,000 expected (last tax due went on the credit cards...do not think that we have sufficient space on the cards this time round). We have zero assets and no rich relatives or others who could bail us out.


At present our credit ratings are perfect as we have always paid our minimum payments and everything else, but I know how rapidly that could change if we start missing payments. It does not matter which scenario we attempt there seems to be no way forward. £2000 per month repayments just covers the interest and we could go for another decade and never have sufficient funds to clear the cards off.


I do not relish the thought of bankruptcy, but it seems if it is going to happen then better to get on top of the situation now because aside from a miraculous lottery win then there is no way out for us. We could both get jobs after the process and attempt to start again but I really want to avoid having repayment orders and other long term pain.


I would welcome information/guidance/assistance from those who have gone through or are going through bankruptcy, and of course any professionals who monitor the forum who offer services which I guess I will need fairly soon.


Below are some questions I have now:

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What are the mystery ‘luxury items’ that the receiver allows you to keep? We rent our house and this such as the oven & washing machine are part of the fixtures and fittings. We have sofas, beds and a kitchen table - surely these are safe? How about the televisions (2 bog standard flat screens that can be bought from Argos for £350)[/size]

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I own a tired estate car which I purchased for £500 so I guess that it will be O.K. to keep it - but knowing would be useful.[/size]

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I have one daughter still in private school. Does the receiver make an allowance for the £10,000 per year school fees or is he going to laugh out loud and put a red line through that element of my bankruptcy claim?[/size]

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Will the receiver allow for gym fees at £60 per month as one of my wifes allowable necessary living costs after bankruptcy?[/size]

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My wife has a car on a 3 year lease. Will this cost of £180 per month be allowed or will the receiver force the termination and default of this agreement as part of the process?[/size]

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We have private medical cover which costs £1800 per year. Is it allowable to claim this as an offset after bankruptcy especially as I am currently in treatment which may last another 12 months - if not then the NHS will have to foot the bill which seems unfair to the taxpayer.[/size]

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Am I going to get heavies turn up at my home and whisk away my children's mobile phones and laptop[/size]

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What are the three top tips that you would give to someone who wants to restart their life through going bankrupt?[/size]



Thank you in advance for taking the time to read and respond. Best luck and health to any who are in the same situation.