Things included in Bankruptcy and the best time

[worriednanxious]

Hi,

 

For a bit of background I am a single parent with a mortgage but no equity. I have just recently (last week) taken a £10k loan to clear credit cards and thought I was getting myself straight. However I just discovered that a case from Northern Rock that I thought had been closed last year may well raise its head again and they could win. This is for a joint unsecured loan in the region of £25k. If they decide to take this back to court I really couldn't pay anything else and am thinking that making myself bankrupt would be the only solution.

 

My questions are - Would the unsecured joint loan be included in the bankruptcy (wondering because it is in joint names)?

 

Secondly should I declare bankruptcy before they take the matter to court. If we go to court and get a CCJ and then declare bankruptcy would the CCJ be included and would the CCJ be cleared from the credit files? (Although don't suppose a CCJ matters when your registered as bankrupt)

 

Any advice gratefully recieved as always - I would panic so much without you guys for help.

 

Thanks x

[toddle2u]

Yes the joint loan would be included in the bankruptcy. The creditor would pursue the other joint creditor rather than yourself as in most cases it would be a joint and several liability.

 

The CCJ would not be cleared by the BR and would remain on your credit file but as you state this would not make much difference because of the BR.

 

Personally I would wait for the case to come to court. What would be the point of declaring yourself BR only to find NR don't take it to court?

[worriednanxious]

Thankyou for the advice, it sounds sensible and what I was thinking myself.

 

In regards to waiting for them to take it to court - how long would BR take roughly, I am worried that if they take it to court and get a CO on my home this wouldn't then be included in the BR. And if they do get one is a CO discharged when you sell even if the full amount isn't repaid by the profit? I would be looking to sell my home in a year or so anyway and move in with my bf so that wouldn't bother me but wouldn't want to still have it hanging over me as there wouldn't be anywhere near enough (if anything at all) to repay what they are asking.

[caledfwlch]

Thankyou for the advice, it sounds sensible and what I was thinking myself.

 

In regards to waiting for them to take it to court - how long would BR take roughly, I am worried that if they take it to court and get a CO on my home this wouldn't then be included in the BR. And if they do get one is a CO discharged when you sell even if the full amount isn't repaid by the profit? I would be looking to sell my home in a year or so anyway and move in with my bf so that wouldn't bother me but wouldn't want to still have it hanging over me as there wouldn't be anywhere near enough (if anything at all) to repay what they are asking.

 

I would imagine, if you have the fee's to pay for the BR, then it would be done and dusted well, well before anything like a Charging Order made it into a court room. It will not come automatically with a CCJ - there all all sorts of hoops and hurdles before that would happen.

 

The only thing I would warn is the Insolvency Practictioner/Judge might look very darkly upon the fact you took a £10,000 loan out and then very quickly went bankrupt. Though if you are waiting until this £25,000 becomes a CCJ then you can cite that life has "changed" suddenly, and you never expected to have to go BR, till this 25,000 reared its ugly head again. People more experienced on here will have better advice regards that loan, than me

[toddle2u]

If the full amount isn't dicharged by the sale of the property the balance becomes an unsecured debt which they can still chase prior to any BR. If the CO is made close to the BR it may be overturned by the OR as allowing a preference

[worriednanxious]

Thanks for the responses, in regards to the £10k loan I can prove that it was taken before I realised that things with NR hadn't finished. I can also prove that it was all used to clear credit cards debts so I was sincerly trying to get myself back on track by consolidating. I would have struggled a bit to make repayments but thought I could manage and envisaged a changed in circumstances in the near future as my bf was going to move in at the end of June! Do you think they will understand this? I really don't think I have any other options but to go the BR route, the stress and panic I'm am having because of this is not making a happy life for my little un and its not their fault.

[toddle2u]

I would say that the story stacks up and you wouldn't have any problems with OR if you explained it like this. I can understand the stress you are under and if you think BR is the best option only you can make that decision. But as stated previoulsy why make yourself BR if NR don't come after you - why not wait to see what happens.

[worriednanxious]

The NR thing won't be statute barred for another 4 years and I don't think I can put up with the worry for that long. Also I would be struggling with my own debts for the next five years and trying to clear them and then NR could decide they are going to take me to court again and I'm back at square one. I think really need to just draw a line under it and get on with my life so my child and I can start having fun again without the constant worry of what has landed on the doormat while I've been at work! Thanks for the help and advice, I've made up my mind that BR is the route for me - wish me luck xx

[toddle2u]

Good Luck - by the way you have described it and the pressure you are under I feel you have made the right decision. If you need any more help or advice just shout

[scottybhoy]

have just read your post. I wish you all the luck. You hit the nail in the head about drawing a line under it! My partner and I have been battling our debt problem for the last 3 years and it does take its toll on your health, relationship, work, family - its not good. You will prob see my post on this forum about my home and NR mortgage. At the end of the day, if I could draw a line under it and keep my home by going bankrupt, that would be an option I would take gladly. I have given myself one year and one last shot at sorting myself out. If not, then I don't care if I lose my home as happines is more important. If I was you I would go for the BR - but that is just my opinion - go for your peace of mind, start a fresh and enjoy the time you have with your family. Good luck. May be joining you on that register soon!