Should I go bankrupt?

[jon1965]

I have debts of c.40K over about 18 creditors . I have no assets and my only income is ESA. I am paying £1 per month token payment to each creditor as a token payment. I am actively looking for work, however there are some mental health issues that make me nervous about starting a new job (stress, depression, low self esteem) and a potential serious court case.
I am in a DMP with a paid for company which costs me £10 pm and for me is worth the stress relief. Please no preaching about it as it works for me
At some point (hopefully many years) I will become the beneficiary of a trust . This will be 1/3rd of my mothers estate and is being done as a trust to stop my (ex) wife or her family having any claim on me when I do inherit. My family have no idea about my debts although my ex and my partner do.
So the question is, is bankruptcy right for me, and how long after I have been discharged can the OR look at my finances. For example if I am discharged in 12 months can they still claim money from any job I have?
Any help would be appreciated

[Talay]

Re: Should I go bankrupt?

My view of BR was negative on two points. One, you have to answer questions in the future for work and financial dealings as to whether you have ever been BR and there is no 6 year absolution for BR because it is on a list forever.

That said, it does draw a line in the sand and give you a fresh start.

My view would change somewhat if the intended BR already had a property which they could keep through the BR and thus avoid the problem of having to approach a lender after BR for a mortgage. You can live without everyday credit but you cannot so easily live without credit to buy somewhere to live.

[SXGuy]

Re: Should I go bankrupt?

Sorry Talay i disagree, dont know where you get your info from.

BR stays on your credit file for 6 years, and then is removed, i know because i went bankrupt in 2004, and was discharged in 2005, BR came off in 2010, discharge notice was never shown on my credit file, so it was a year earlier than expected for me to be all clear.

I have NEVER disclosed this to any employer AFTER discharge, and never needed to, they have no way of finding it out as well. Yes you tell them during BR, but it should not affect whether you get that job or not, its merely so money can be deducted to repay your debts.

jon, if you own no assets, no house etc, and you see yourself not needing credit for at least 6 years, then BR is the best option to you as i can see.

They will only take part of your income to repay your debts during your bankruptcy, once discharged, they wont touch it.

And during that time, what they do take is Income - Expenses - Less living costs - half the remainder. so its not that bad.

Bare in mind tho, if you go to the insolvancy service, do not wear any jewellery and only take about £5 with you in your pocket (excluding bankruptcy costs), they will take it otherwise.

Dont worry about the estate, providing you do not receive it during your bankrupcy they wont touch it.

And any debt relating prior to brankruptcy after discharge, you will not be liable for, you point them all to the offical receiver.

[confused76]

Re: Should I go bankrupt?

Hi Jon

Have a look at these threads first to get a bit more information about bankruptcy.

~ Look here first - Bankruptcy Help ~ - allaboutFORUMS

Bankruptcy Explained - allaboutFORUMS

Please give one of the free debt charities a call to discuss whether bankruptcy would be a suitable option for you. I found the National Debtline to be helpful.

Main recommended sources of help:

• Consumer Credit Counselling Service - Website: Click Here CCCS Telephone: 0800 138 1111
• National Debtline - Website: Click Here National Debtline Telephone: 0808 808 4000
• Citizens Advice Bureau - Website: Click Here or visit your local CAB centre.
  To find nearest CAB centre to you - Click Here

Other things to consider are what line of work you're in, would bankruptcy affect future job prospects for you? Bankruptcy is a last resort but can be a relief if it's the right thing for you. I went br in 2009, sometimes i wish i'd held off a bit longer and considered other options.

Have you considered the unenforceability route?

Unenforceability - allaboutFORUMS

All the best, please stick around i'm sure others will chip in with their thoughts xx

edit - and it is my understanding that br stays on your credit file for 6 years but will forever remain searchable and if you're asked have you ever been made bankrupt in the past you would need to disclose this

[jon1965]

Re: Should I go bankrupt?

Thanks for the advice guys. I am not working at the moment and receiving ESA. My career has been in sales, and so far as I know the fact I am in a DMP at the moment has cost me the chance of only 1 job. I do understand that I would never be able to work in the financial services sector which includes retail that sells such things (mobile phone shops , electrical retails , argos etc)

[Talay]

Re: Should I go bankrupt?

Sorry Talay i disagree, dont know where you get your info from.

BR stays on your credit file for 6 years, and then is removed, i know because i went bankrupt in 2004, and was discharged in 2005, BR came off in 2010, discharge notice was never shown on my credit file, so it was a year earlier than expected for me to be all clear.

I have NEVER disclosed this to any employer AFTER discharge, and never needed to, they have no way of finding it out as well. Yes you tell them during BR, but it should not affect whether you get that job or not, its merely so money can be deducted to repay your debts....

Every loan, credit facility or mortgage you ever ask for seems to have this question "Have you ever been declared bankrupt". It doesn't ask whether you are discharged or not discharged nor does it care how long ago you were made bankrupt. It simply asks whether at any point in your life have you ever been bankrupt. Answer incorrectly and that is fraud.

You are right that it does not show on your credit file after 6 years but that is not the whole story is it ? All mortgage lenders and probably all other financial institutions have access to another list, compiled out of the Gazette (as it is public information against your credit history, which is private), which permanently declares your bankrupt history.

There is a list on MSE of a guy who phoned about 50 lenders to see if they would lend to an ex bankrupt and only about 10 would. If you are considering life after bankruptcy then I think that is important information to know. Insurance for your house, car and life all need you to answer this question and then penalise you for doing so.

As for work, I'll bet a penny to a pound that any new screening process written up in the last 12 months includes a question regarding bankruptcy. Every financial job almost certainly requires the company to ask their staff as part of compliance. The reach of bankruptcy extends way past the date of discharge.

This is of course only looking at the negatives. There are a lot of positives but I looked into the light at he end of the tunnel which was bankruptcy and saw not fresh fields and a calmer day with rays of sunshine but rather the oncoming light of a train wreck which would never end, even after 6 years.

All I am saying is that you go into bankruptcy fully prepared for the future consequences which you cannot stop and don't find out afterwards that you would rather have kept the genie in the box. That we will all offer whatever support we can is without question.

[SXGuy]

Re: Should I go bankrupt?

Ok Talay, i can see that from your point of view, BR would not be the best option, from mine, it was.

Im self employed, so BR has never affected me at all.

I recently secured a mortgage, so BR never affected that either.

I used a mortgage broker, not once was i asked if i had ever been bankrupt.

So while some may ask the question, there are others who do not.

I get that you may not be able to work for the financial sector but that is not the only job sector out there.

All im trying to say is, for a lot of debt and no asset BR to me, is the easy road out to recovery. Of course any one debating whether BR is right for them or not, should weigh up everything before making a decision.

[philnicandamy]

Re: Should I go bankrupt?

You are right that it does not show on your credit file after 6 years but that is not the whole story is it ? All mortgage lenders and probably all other financial institutions have access to another list, compiled out of the Gazette (as it is public information against your credit history, which is private), which permanently declares your bankrupt history.

I've heard many times about the list you mention...never had any solid proof however it exsists and as for financial positions its not always so cut & dry i've known a few bankrupts in the financial sector still able to keep their positions

[PlanB]

Re: Should I go bankrupt?

I have debts of c.40K over about 18 creditors . I have no assets and my only income is ESA. I am paying £1 per month token payment to each creditor as a token payment

Were any of these debts credit cards or loans taken out before April 2007 which have the potential to be unenforceable Maybe it would make sense to establish that first before making a big decision like BR. If you're only making token payments your credit rating has already been shot to pieces so why not take a punt on getting rid of these 'live' debts before you make your mind up about the next step

[philnicandamy]

Re: Should I go bankrupt?

Good advice from everyone as usual....have a look at what people suggested and then and finally then if all other options are closed then bankrupty MAY be a solution..but its not a quick fix as others have said and can have implications on your life for many years to come

[IF]

Re: Should I go bankrupt?

Hi jon1965 and welcome to the BR board. There's a lot to take in right now but don't be afraid to ask anything.
The only 'silly' question is an unasked one!!

Best Wishes
IF...x

[Talay]

Re: Should I go bankrupt?

I've heard many times about the list you mention...never had any solid proof however it exsists and as for financial positions its not always so cut & dry i've known a few bankrupts in the financial sector still able to keep their positions

I don't have a reference to hand but some time ago someone with access to it came out and spoke about it. I'm guessing it was on MSE but it could be from another place.

You're right that it doesn't (didn't ?) matter to some, if not many finance jobs but I'll wager there is a world of difference between keeping on a loyal worker who has gone through BR and looking through a list of CVs and finding a reason to throw some aside. You'd need to jump through all kinds of hoops to get it past compliance these days.

The OP is also currently unemployed and has already seen first hand losing a job opportunity because he has a DMP. Adding bankruptcy isn't going to help.

[jon1965]

Re: Should I go bankrupt?

Thanks all.
I have posted a longer explanation on the unenforceability board --->Help and advice please - allaboutFORUMS.
I don't want to duplicate it and if i am honest am not that savvy about forums etc (or is it fora?).

[philnicandamy]

Re: Should I go bankrupt?

The OP is also currently unemployed and has already seen first hand losing a job opportunity because he has a DMP. Adding bankruptcy isn't going to help.

I agree..but as I said in previous posts job's are sure "difficult" to obtain now with the current climate but not impossible once bankrupt or discharged bankrupt....but as I said bankruptcy needs to be researched you need to know ALL the bits & bobs before deciding as once all other options are useless its the LAST resort to your financial probs

[philnicandamy]

Re: Should I go bankrupt?

Hmm if only i'd known about UE 5yrs ago....