help before I make the final decision

[jss]

Hello, I will go straight to the point if I may. I am 33 married with 2 kids (2.5y & 10m). I am in big debt & have a county court hearing set for tomorrow morning, writing to you as maybe you may help sort it out before I make the final decision.

My total unsecured debt is around £65k and our home has been repocessed already, which after the sale has left a further debt of £107k to the mortgage provider (it was off plan purchase and demand disappeared, hence they couldn't sell anywhere near the amount paid). So total debt is around £172,000 inc interest I presume. Right now I work as a cab driver and the absolute maximum I can stretch repayments if agreed would be around £400 p/m. IYO is there any point even considering making arrangements with creditors or not? Thank you very much.

[iva.com]

Hello jss, and welcome to the forum.

With unsecured debts of £172K and a disposable income of £400 I believe that you would struggle to go into an IVA. As there would be no implications to your employment and you have already lost your home, have you considered bankruptcy?

Before making any decisions I would recommend speaking to an IP/Debt Advisor.

Kind regards,
Terry Balfour
IVA.com

[Adam Davies]

Hi
As Terry has said speak directly with an Insolvency Practitioner,however bankruptcy does seem the best option on the info provided
Regards

[mish1953]

JSS - £172k divided by £400 divided by 12 = ?

About 36 years to repay that - and that doesnt include the interest

You are 33 yrs old ...

You might want to think about Bankruptcy

You really need to speak to an insolvency practitioner and get some advice .

Cheers and good luck
Mish

[MelanieGiles]

Those debts are too high to be serviced properly by an IVA under usual circumstances, but as the mortgage shortfall represents the highest creditor, an insolvency practitioner might be able to persuade them to accept a very low dividend - which would be in the region of 10p in the £.

A tricky case, and as you have no assets bankruptcy may certainly look more appealing, as it appears you have nothing left to lose.

[go_4_broke]

Hello jss

As others have indicated you would need a good reason to want to enter and IVA as an alternative to bankruptcy as on the face of it you have nothing to gain (unless you WANT to pay more of your income over for longer).

If you have a hearing for a CCJ it is a good idea to try and get an offer of payment agreed even if fairly small as this will keep the bailiffs and other nasties away while you get things sorted out.

Best Regards, Simon

[jss]

Thanks for all your advice, I will proceed with bankruptcy, I would never have thought to find myself in this situation

[AlanO]

Hi Jss,

Bankruptcy will provide the clear start for you.

all the best alan

www.debtdr.co.uk

[jss]

I called local county court & they said next available day is April 10th, would anyone know whether filing a bankruptcy after April 6th will mean that income TAX for 2007 will have to be paid? Thank you.

[Skippy]

If you go BR in the new tax year you will more than likely get a Nil Tax code - all your tax will be paid to you and you will have to pay it to the OR.

[jss]

I am self-employed, so I haven't paid any TAX for 2007 yet. Do you mean to say that whatever TAX is due for 2007 will now have to be payable to the OR instead?(official receiver?) Thank you.

[Skippy]

Sorry, I didn't realise you are self employed. I don't know what the arrangements are for tax in that situation - this is one for the experts!

[MelanieGiles]

The effect of bankruptcy on 10 April 2008 will be that all the tax deemed due for fiscal year 2008/2009 will be included within the bankruptcy - but do remember that you need your Trustee's express permission to continue trading which is not always guaranteed.

[jss]

Thank you. I managed to get a slot on April 2nd, so I am still within 2007 tax year. BTW I do not trade I am a self-employed private hire driver, can they stop me from working?

[MelanieGiles]

That would be unlikely.