Hi I wonder if you could help.

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caroline.ma
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by caroline.ma » Thu Jan 28, 2010 11:33 am
Hi I wonder if you could help. I have approximately 38,000 worth of debts with 3 x creditors including 1 x loan and 2 x credit cards. My housemate was supposed to be paying me rent which she has stopped doing and subsequently spent my savings and on my credit card which has caused this debt to become a problem. I own a flat on a part rent part buy basis, I own 40% of this property. I need to get rid of the current debts that I have as I cannot afford to pay them. My income per month is approximately £2012 and my expenditure with the upkeep of the house is approximately £1950, the creditors I need to pay are approximately £862 per month which as you can see is not possible to pay with the amount of money I have left per month. Firstly I need to ensure that I do not lose the flat as I have a young son whom is 4 months old and need to be able to provide a home for him. Please help!

 

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Declan at DebtFreeDirect
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by Declan at DebtFreeDirect » Thu Jan 28, 2010 11:44 am
Hi Caroline and welcome to the forum.
Based on what you have said it appears that there are a number of options open to you including an IVA. Its best to seek professional advice from an Insolvency Practitioner who will be able to look at your situation in greater detail and recommend the best way forward for you.

Thanks

 

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caroline.ma
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by caroline.ma » Thu Jan 28, 2010 11:58 am
Thanks Declan. I did seek advice from someone that came round to see me last night and advised Bankrupcy would be the best way forward, im concerned about losing my home and they wanted a fee of £2.5k upfront which I would struggle to find. Thanks

 

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kallis3
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by kallis3 » Thu Jan 28, 2010 12:07 pm
Hi Caroline, and welcome from me as well.

Who was the company that you saw? Do not touch them with a ten foot barge pole. It is stupid to charge that much to go bankrupt when you can do it yourself by filling the forms in online and just paying the court fees.

You need to speak to one or two experts. Either click on the experts link on the left hand side of the page here and you will some who post on here, or visit www.iva.com for a list of companies and reviews. Do give some of them a ring and you will receive free and impartial advice as to all the options open to you.

Do not agree to paying anything to the company you saw.

 

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size5
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by size5 » Thu Jan 28, 2010 12:09 pm
Even if BR is the best route, and of course take a couple more opinions before you decide, then paying someone £2.5k to do something that you can do for yourself for free, other than the court fee, doesn't make any sense at all.

Regards.

 

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kallis3
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by kallis3 » Thu Jan 28, 2010 12:16 pm
Exactly Mike! That is a lot of money to pay, especially if you don't have it in the first place!

Where on earth do they think you would find £2.5k as an upfront payment when you are insolvent?

I'd be interested to know who this company are.

 

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Declan at DebtFreeDirect
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by Declan at DebtFreeDirect » Thu Jan 28, 2010 12:17 pm
As the guys have mentioned, seek the advice of a number of different companies before deciding on the best route. I would be extremely weary of any company recommending bankruptcy straight off and then charging a £2.5k fee. This is ridiculous and as mentioned avoid them.

Thanks

 

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Michael Peoples
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by Michael Peoples » Thu Jan 28, 2010 12:29 pm
I can only agree with what the others have said. The firms on here all give free advice and you can go bankrupt yourself for the cost of £510. There are perfectly reputable firms that will help you through the bankruptcy for a reasonable fee but £2,500 is a ripoff.

The other thing to be aware of is your property. Provided you have no equity there should be no problem but even though you only own 40% of the property if there is equity within that 40% it would have to be realised. What is the value of your home and how much is your mortgage balance?

 

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caroline.ma
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by caroline.ma » Thu Jan 28, 2010 12:42 pm
Hi Michael, the property was worth £180k when I bought it, I took a 40% share which was a total of £72k, £10,800 of which was financed through a loan and £61,200 on a mortgage, its a fixed rate mortgage with Woolwich, have been paying for 6 months now. I would invisage that the property is now worth about £160k. What do you think?

 

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kallis3
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by kallis3 » Thu Jan 28, 2010 12:49 pm
Which company has advised that BR is your only route Caroline?

Please pick up the phone and seek advice from other companies. You do not have to pay such extortionate fees for someone to help you go bankrupt, and you may not have to do that.

 

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Michael Peoples
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by Michael Peoples » Thu Jan 28, 2010 12:54 pm
It is to your advantage Caroline that the property has dropped in value and now effectively has no equity. Your 40% share is now only worth about £64,000 which is probably less than the redemption figure owing to the Woolwich. Therefore a third party could buy your interest for £1 plus £211 costs and your property is secure.

For piece of mind it would be worth getting the property valued before you go bankrupt as you do not want any nasty surprises.

 

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Tina Shortland
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by Tina Shortland » Thu Jan 28, 2010 6:40 pm
Hi Caroline, I bet you're glad you popped on here to ask your question now! Sorry to hear you've been let down and left in a mess, especially with such a young son to look after too. You'll get great advice and support from the companies and members on here and when you're ready, have a chat with a few companies to find out what is best for you. You'll only find that out by going through all your details and understanding the implications of all options.

Regards,

 

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MelanieGiles
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by MelanieGiles » Thu Jan 28, 2010 10:17 pm
Definately Tina - and how many calls do we get to the office from people who have received similar advice!

If I read the original post correctly, Caroline only has a disposable income of £62 before creditor repayments, so bankruptcy would seem the best option -but she certainly does not need to fork out £2,500 for this.

Which company did you ask to come round to meet with you Caroline?

 

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caroline.ma
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by caroline.ma » Fri Jan 29, 2010 11:07 am
Thanks Ladies, Co is DebtDr. I had a good chat with someone who got my details off this website yesterday night and she was brilliant. BR does seem my best route to take, though feel incredibly bad that I have to go down that route, my main concern is my house, which if its in neg equity then I can buy it for £1! I did sleep alot better last night and I did speak with the other company and said how do you expect someone that you want to confirm as BR to pay £2.5k in fees?! Doesnt make sense to me, but then thats the first company I approached and there has been a lot of support from my friends at work whom have either gone through it themselves or know someone that has gone through it to and done it themselves.

 

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kallis3
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by kallis3 » Fri Jan 29, 2010 11:17 am
Hi Caroline,

Glad you've managed to get some good advice and support.

As regards the BI in your house I believe, and I'm sure someone will correct me if I am wrong, that someone else will have to purchase that for you.

What did the other company say when you told them that?

Don't forget that there are several people on here who have been bankrupt and can help you with the forms.
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