Personal Bankruptcy

Life Goes On

2007-05-20T09:08:00.000+01:00

So much has been happening in my life that I have had little time to post. Apologies.

Since being discharged I have got a new job that pays extremely well. I have have had weight loss surgery and have lost over 30 kilos in less than 3 months. I have also been trying to get a better bank account.

After trawling around the different banks, who on the whole have been pretty much useless, a firend suggested I contact First Direct. I had thought about them before but had discounted them as being only interested in "good" customers.

A quick chat on the phone and an application lead to to the inevitable refusal but then a glimmer of hope. The guy on the phone said that he would send me an application form and if I got my credit report from Experian, enclosed my last 3 months bank statement and discharge certificate then they would consider my application again. I pushed him on this and he said that they consider each case on it's own merits but given that I was earning well he couldn't see a problem.

What impressed me more was that he said that if I was accepted I would be offered the normal facilities of the bank including mortgages and credit cards. It almost sounded like a return to normality. I have been offered a mortagage via the Halifax sub-prime (Birmingham Midshires, I think) but that was with a 15% deposit so a long time of saving would be needed.

I will post my application with all the various bits of paperwork today and let you know how I get on.

Beat the bailiffs

2006-09-26T13:14:00.000+01:00

The debt boom continues and the latest BBC undover sting targets the Baliffs. Wehen I went bankrupt I was terrified of baliffs coming to strip my home, in reality no-one ever showed up. I had always paid my rent and council tax as priority debts and anything I had brought by credit card was nsecured and thereby not recoverable.

With a little research I learned that even should the Baliff come knocking the simple solution is to make sure he cannot get in and you don't have to answer the door to them. What you must do is recognise that if the Baliff is there you probably have not paid a bill and you should get it paid or arrange a plan to pay it.

The link above provides some basic info about the baliff and what they can and cannot do.

The Whistleblower programme will be broadcast on BBC One, Tuesday 26 September at 2100 BST and the BBC news article can be read here.

UK Credit Card 40 Years Old

2006-06-26T12:30:00.000+01:00

Browsing the BBC site I noticed that the credit card is 40 years old in the UK. Card were first introduced by Barclays in 1966 and then with the advent of the Access card in 1972, cards became nmainstream. Initially the cards required that you pay the monthly balance in full but this changed with the introduction legislation that allowed debt to accumulate on the card.

My favourite quote in the piece is about the people that use credit cards:

"To all intents and purposes, these people form a self-defining, captive, sucker market."

Having been suckered once by the lure of these flexible friends I am sure to never get into the habit of putting it on the card again.

Click the title to go to the piece on the BBC web site.

Extreme Debt Getting Worse

2006-06-22T07:29:00.000+01:00

The CCCS are reporting that extreme debt is on the increase. Debt management plans are on the increase as is the level of debt generally.

Living without any debt is liberating. The money I now have is my own and not being able to get credit means that I am not tempted to buy now pay later. Someone once said that all you do by borrowing is mortgage your future. A quick pleasurable experience right now, whether it's a CD an IPOD or a holiday brought on credit has to be paid for sooner or later.

If you are struggling with your debts contact the CCCS or one of the many other debt advice agencies listed to your right on the screen. Don't be taken in by debt management companies, you can get a better service free from the charitable organisations set up to help people with debt problems.

Success

2006-06-21T23:13:00.000+01:00

Got home this evening to two letters from the CO-OP. Unfortunately, one of them rather spoilt the surprise. It said on the envelope:

WELCOME TO YOUR NEW ACCOUNT

I have been grinning all night long. It feels as if I have reached a major stage in life post bankruptcy. A major bank has allowed me to have a Visa Electron Debit card, which means I won't have to be managing cash all the time. I even have the card already and will be able to use it once I get some funds into the account.

What's more amazing is that they didn't want copies of court documentation. I simply told the call agent when I was discharged and she noted it on the application.

I am delighted and heartily recommend the CO-OP Bank to you as ethical and discharged bankrupt friendly. A link to the CO-OP Bank is embedded in the title of this post.

More on Bank Accounts

2006-06-14T20:28:00.000+01:00

As expected the application for the Smile account was turned down. My application to the Co-Op for a Cashminder account has been referred and I am waiting for them to contact me about what further information I need to provide. It's fingers crossed to get a Cashminder account and enter the world of the carded again.

If this doesn't work out I think it's Nat West next. I will not succumb to taking on a prepay Visa or Mastercard as I feel that the monthly fees and associated charges far outweigh the benefits.

In my mind it's a simple transaction that needs to be completed with a bank. Let me demonstrate to you that I am employed, have an income. In return the bank should provide some basic facilities, such as a payment card and don't let me spend more than I have. The Electron card is great for this as I would not be able to spend more that was on the account. The only downside is I wouldn't be able to purchase by telephone as there is no CVS (security) code.

I personally like the fact that the Co-Op is an ethical bank and has some real values from the the Co-operative Movement which started in 1844. I do hope that they are able to accept me as a customer and being a loyal sort of chap they will probably keep me as a customer for a long time to come.

Once I am paid at the end of the month I will investigate the world of credit reference agencies and let you know what happens to our credit files in bankruptcy and beyond.

There has to be a way back to being carded for a discharged bankrupt and I am determined to find it!

Bank Accounts

2006-06-05T20:27:00.000+01:00

Ever persistent in my quest for a debit card I have now applied to Smile.co.uk. Speaking to the nice customer services lady, I realised that I had made a mistake with my Co-Op banks. When I searched for co-op bank, Smile came back as top of the results, so off I went online and applied for a current account. In fact what I had meant to do was get a basic co-op bank account called a "Cashminder" which comes with an Electron Card.

I will now have to wait for the Smile application to process and probably decline, before I apply for the Cashminder.

I say that the Smile account will decline for the simple reason that it comes with a Visa Debit card and a standard overdraft. It seems it is much too early for someone who is a recently discharged bankrupt to have a grown ups account.

the link on the title to this post will take you to a helpful FSA document about basic bank accounts. The more perceptive will also note that Nat West do a basic account with a Maestro Card.

I am still waiting to get paid before I spend any money on checking out my credit scores. When I do I will let you know.

Declined

2006-05-22T13:15:00.000+01:00

Vanquis turned me down flat. Having applied for a card specially designed for people with a poor credit history I was hopeful that Vanquis would be able to help me out. Please understand I don not want a card so that I can start building up debts again. I want a card so that I can purchase goods and services on line.

Vanquis helpfully sent me a credit information service discount voucher and I am investigating this service. I am sure that I have been declined because the bankruptcy is unresolved on my credit file.

So the next step is to investigate my credit reports and find out how I can get my creditors to show the outstanding debts as discharged.

Watch this space... more soon.

Books on debt

2006-04-25T19:14:00.000+01:00

I have given into the request to put information on the site for books about debt. My view is that if you are in debt you should stop spending, except for those things you actually need. I have not brought a book, cd or dvd since 2004 and intend to keep it that way. Your local library will have lots of books available and are usually able to order what they don't have in stock.

If you really must buy a book on debt then use the link embedded in the title of this post or see the bottom of the page for an advert.

Alvin Hall and the Rich Dad Poor Dad books are excellent.

Happy reading.

Life without a debit card

2006-04-23T23:20:00.000+01:00

The past few weeks have been very frustrating. I am beginning to rebuild my business life after the bankruptcy and need to spend money on the internet. My problem is that I only have a cash card for my bank account and every service I require seems to need a credit card to purchase.

Fortunately many traders now accept payment via PayPal. I use PayPal myself to allow my clients to pay by methods other than cheque or cash. When you signup for PayPal, you can start accepting credit card payments instantly. I realised that as the world's number one online payment service, PayPal was the fastest way to get a merchant account for my business. Best of all, it was completely free to sign up for a merchant account and my bankruptcy was not an issue! To sign up click the link at the top of the page.

I tried getting a card from my bank but in their eyes I am still a risk and they have advised me not apply again for another 3 months. Looking around on the forums people seem to recommend the Co-Op so I will investigate further and see what they offer.

The other route that has been suggested is pre-pay credit cards. To be completely frank with you, whilst I can see the benefit of being able to use one of these cards the cost seems prohibitive. They will my last resort.

I have also tried applying for a Capital One card for people with bad credit histories and also a Vanquis Card. Capital One turned me down immediately and I am still waiting to hear from Vanquis. You need to understand that it is not credit I am after, it is simply the transactional facility that these cards offer to purchase goods online.

If anyone has any more ideas about bank accounts for discharged bankrupts that include a debit card or a bankrupt friendly credit card company please let me know.

In the next few days I will be posting information about what information will help you with the credit reference agencies and also update you on my quest for friendly banking facilities. Stay tuned!

Hand down a hole

2006-04-12T19:57:00.000+01:00

I receive feedback from this site and it is always heart rending to hear how other people are being affected by debt in their lives. Today I got an anonymous comment where the person wrote:

"your positive attitude is an inspiration. I really admire you. I feel like digging a hole & climbing in it!!"

The truth is that is has been hard to stay positive and maintain perspective on what was happening. I didn't own any property which would have drawn out the process and probably increased the stress. Plus I am single so had nobody to worry about but myself.

Whilst the anonymous poster feels like digging a hole and climbing into it, there are plenty of people who are there to help you stay out of the hole or give you a lift out. Check out the links on the right hand side of the page for where to get advice.

Watch out for the organisations and individuals who will offer you miraculous solutions for your situation. If it seems to good to be true then it probably is. Most Insolvency Practitioners will talk to you honestly about IVA's and tell you frankly if you do not earn enough or have enough capital to make one work. Though my suggestion is to start with an organisation like CCCS and take it from there.

The best advice I was given was to face up to your situation and begin to deal with it. It is not the end of the world though it may seem like it.

To my anonymous poster - use the links and get some help - don't delay take action today!

What It's Like To Go Bankrupt

2006-04-11T11:23:00.000+01:00

My Motley Fool email came with the above title today. You know I would be hooked straight away.

Click the title of this post to be taken to the article by Jane Mack.

Life goes on in cash!

54 Weeks Later

2006-04-01T04:12:00.000+01:00

It is now 54 weeks after I was declared bankrupt. Depict an early discharge, life continues to be a roller coaster and the financial struggles continue.

On the TV I have been shocked by some of the rubbish that is being shown about people who are in debt. A BBC programme which I think was called "Beat the bailiffs" was particularly distressing. It showed people who are in debt being given a dry run of what it will be like when things get out of control. Frankly, it was very disturbing and would have been upsetting for anyone in real financial crisis. Remember that there are plenty of organisations who are there to help (Look ====>>>>>) If the worst comes to the worst, don't let the bailiffs in, you don't have to, unless you have let them in before. Once you have let them in then they can come in again anytime, even without your permission. So don't let them in! Remember as well that if you go personally bankrupt the bailiffs won't come looking for your clothes, beds, furniture or personal belongings, unless you have something of great value. Just have a look on e-bay at what your belongings are really worth and realise that the cost to creditors of obtaining and then disposing of your assets will probably be prohibitive, unless you own lots of bling and flash cars.

Remember that there are lots of organisations to help you resolve your debt crisis for free. I was helped by the Consumer Credit Counseling Service who were brilliant. Don't despair, don't give up and face up to what really is going on.

Finding the type of work I need locally has been difficult, yet I am tied to the area by close friendships. There is no easy answer to be had, I just wish that I could find the work I need!

I have been fortunate to have regular work teaching at a nearby University though this have is now finishing until October. I really want to be coaching and finding clients for that is going more slowly than I would have hoped.

Strangely though I still feel positive. The financial crunch will come in May when I have to make a decision about moving from where I live now.

In my dreams I see a place of abundance and know it is just around the corner. I feel like a lottery winner most days just for waking up. I have so much love in my life, so many friends and so much to be grateful for. I try to stay focused on my gratitude and that helps me get through the darker days.

Be brave, be bold, be truthful to yourself.

Personal Bankruptcy Increases

2005-11-04T11:30:00.000Z

It has been announced today that there has been a record increase in the number of people becoming insolvent. IVA's seem to the most popular way forward although Personal Bankruptcy is increasing.

Even though the new bankruptcy rules mean that discharge within one year is possible, the real consequences of bankruptcy are with the person for some time. Given the level of personal debt that most individuals have will this be an ongoing trend. What happens if interest rates by even one or two percent?

It seems that I am just one of 60,102 individual insolvencies during the last 12 months.

It's Official

2005-11-04T11:23:00.000Z

Checked the post this morning and found my certificate of discharge. That makes it 34 weeks to the day since I was declared bankrupt. The discharge apparently happened in the middle of October and it has taken this long for the court to sort out the paperwork. In three months my details will be removed from the bankruptcy register.

So, what's next? There are lots of decisions to be made. Do I pay for a notice in the London gazette to announce I am discharged or do I send copies of the notice to all the different credit reference agencies? Do I contact each creditor and ask them to advise the credit reference agencies that their debt has been satisfied by the bankruptcy?

The biggest challenge is now going to be living with repercussions of the bankruptcy for the next six years.

Will keep you all notified of how I am getting on.

Today

2005-10-28T14:38:00.000+01:00

Rang the court again today to find out what was happening with the discharge. Was told that they are still four weeks behind on paperwork. Thankfully I spoke with a reasonable human being who understood that I wanted to get on with my life. The upshot is that I am going to be discharged today and they will send the paperwork to the Insolvency service.

Here's hoping that the Insolvency register will reflect the fact of my discharge soon.

Will post to let you all know when the paperwork is through from the Insolvency service.

Waiting for the Court

2005-10-13T11:03:00.000+01:00

The Official Receiver has sent notice of early discharge to my local County Court. The administration process is now becoming frustrating and fraught with delays. The local County Court has told me that they have a three week backlog on dealing with their post. This means that the discharge is going to be delayed.

It's funny that this piece of paper now holds so much store for me. It is the only way that I can get Sky TV; they won't reconnect me until I am discharged. It's also about getting out of my bankrupt headspace, the certificate of discharge is the key.

Will as always keep you informed with any more news.

Could this be the end?

2005-09-28T02:45:00.000+01:00

Tentatively I wait for some form of contact from the Official Receiver's office. It is now been 29 days since they notified my creditors of their intention to discharge me early from the bankruptcy.

I wonder if any of them have objected to an early discharge? I wonder if I will be discharged early?

Thoughts processes have begun in my mind which help me see the end of the mental debtors prison I have put myself in. I am beginning to think about rebuilding my life and moving on from this perceived place of poverty. Whilst I don't want to get my hopes up for an early discharge, I secretly hanker after the freedom from the shameful feelings and poverty of spirit this process brings.

Watch this space.

RE: Your Affairs in Bankruptcy

2005-09-09T19:39:00.000+01:00

Another letter from the officially Receiver today with the above mentioned title. The letter was enclosing a copy Summary of Receipts and payments which includes a notice to my creditors of the Official Receiver's intentions to apply for release as Trustee of my estate.

This is really good news because it means that the Official Receiver has conclude their administration of my estate and that they want to apply for my early discharge.

If none of my creditors object then the earliest date that the Official Receiver can apply my for my discharge is 28th September 2005, which is 28 weeks and 5 days since being declared bankrupt. If one of the creditors objects and this is found to be without merit the the earliest date will be 12th October 2005.

This has given me a lot of hope and I am now beginning to see release from the debtors prison I had entered in my mind. I know things could still go wrong yet I remain positively optimistic.

By the way today will be 26 weeks since bankruptcy.

Early Discharge?

2005-08-25T19:49:00.000+01:00

I received a letter today from the Official Receiver requesting an update of my personal circumstances. It is at their discretion to apply for an early discharge from bankruptcy. They have enclosed an questionnaire for completion within 14 days about income and expenditure. This shouldn't be too difficult because I am now not working and relying on the generosity of the state and friends to survive.

The questionnaire has to be submitted within 14 days or they will not consider early discharge again. I have completed the form and it is waiting to be posted, I want to be discharged. Once the questionnaire is returned the Official Receiver will contact my creditors to inform them I may receive an early discharge and then consider any objections they have.

This may take a few weeks to complete, though I hope my next post will be to tell you that I have been discharged.

Out of work

2005-06-22T16:33:00.000+01:00

It has been a while since I posted here. The bankruptcy continues and each week is a week closer to discharge. Some creditors are still chasing me directly and about once a week I have to fax another collection company a copy of the order.

The job I had been doing was really stressful, direct sales for internet based products. The stress of the job plus the stress of the bankruptcy got too much about three weeks ago. I was at work and suddenly felt real pressure on my chest. Rushed into hospital and after four days on the cardiac care unit they believe it to be angina. Hopefully it is just something that has been exacerbated by the stress.

Unfortunately the company I worked for did not pay sickness, nor do they tolerate any degree of absence. So I have had to resign. I am now looking for work which is stressful as funds are severely limited.

Will let you know how I get on.

Interview completed

2005-03-22T11:55:00.000Z

The interview is over and I feel a mix of regret, shame and foolishness. The interviewer was thorough and diligent and was happy to answer my numerous questions.

Now all I need to do is wait for the outcome of their investigations and see how they decide my case.

Will update with how the bankruptcy is impacting my life soon.

Waiting for a call

2005-03-22T09:30:00.000Z

Today is my telephone meeting with the official receiver. I sit here with an unreasonable nervousness unsure of what is to come or how my life will be after the call.

In all honesty I can say that I have done all I can to furnish the OR with all documents relating to my finances, though will this be enough. I feel vulnerable, ashamed and naked.

The meeting is happening during work time which means I am losing money. My boss ha just been really nice and told me that I can the morning as holiday yet being in sales I know I have meet my targets and this is getting in the way of that.

Need to focus, need to concentrate on the impending call. The phone rings ...

Drowning in paper

2005-03-17T18:00:00.000Z

I finally finished compiling the paperwork for the Receiver's office at 3:30am on Thursday. In quantity it was less than I had thought though timewise it took much longer to compile than I had anticipated.

Even after sending my past two years financial records to the Receiver I am still left with a huge pile of paper that needs sorting out and filing. This task as you already may be aware of, fills me with doom and despondency. Filing is second only to washing up for me for the chores I hate. Sure, I have read excellent books about "Taming the Paper Tiger" and "Life Laundering" yet I still seem to be faced with the daily onslaught of paper in my mailbox.

Amazingly I seem to have entered a new marketing category. Within 6 days of being declared Bankrupt, my mailbox is now being filled with offers of "No Win No Fee Legal Help to End Bankruptcy". It strikes me that even when you have declared to the world that you are broke, there are still vultures who want to pick over the pieces.

Having realised that my woeful record keeping is costing me time, I have been wondering if it has also cost me money? Is it a trait among bankrupts that the paperwork gets out of hand? I know that the advice is always to keep opening the mail and keep talking to the creditors though the reality for me at least was that many of the past months letters had gone unopened. This has led to costs for me, although it is now unlikely I will pay them. Late payment charges, unpaid direct debit charges and accumulating interest soon mount up.

For those of you who are not the anal retentive types who have everything filed away, the title of this post serves as a link to a useful guide. Though remember you need two years of bank records for the Receiver in Personal Bankruptcy.

What comes next?

2005-03-14T18:41:00.000Z

Well another day and more admin to do for the bankruptcy. I have lost my completion statement for the house sale and have had to get my solicitors to send out a copy. One of the banks who I owe money to are still asking me for money even though the order has been made, so I had to fax them a copy of the order to try and get them off my back. Now I have to begin the task of collating all the information for the official receiver.

I know that to do this quickly will be beneficial, the trouble is I hate filing and paperwork. Around my flat are the scattered financial records needed for compliance. Piles and piles of paperwork. I managed to find the latest bills and statements for the Statement of Affairs, though trying to find two years worth should be interesting. Anyway nothing to do but get on with it.

I will let you know how it goes.

Imminent Insolvency

2005-03-13T14:49:00.000Z

Like many people I am an optimist. I like to think that everything is going to be ok with my world and that any setbacks experienced are only temporary. So ho did I come to be insolvent?

My personal relationship with money has never been good. We meet, we share a short time together and then we part. It's not that I haven't had times when I have had a lot of money, it's just that it has always had other places to go.

I had always taken the view that one can live with a certain amount of debt and that so long as the debt could be serviced then it was ok. In 2002 when I was made redundant from my well paid job, I had enough income to service my debt and live comfortably. What I hadn't anticipated was a long period of unemployment and a failed attempt at starting a business. I lost my job in May 2002 and was unemployed until I established my own business. Unfortunately, I was unable to get any paying clients for the business. In October 2003 I sold my flat and moved abroad to write a book. Throughout this time I managed to pay my debts. I was robbing Peter to pay Paul though. Credit card cash advances were used to make payments for cards. The DSS paid mortgage interest and council tax. Insurances were implemented to pay for loans. It was all being managed.

I knew there was a problem but it was going to be okay. I did talk to an insolvency practitioner, thinking an Individual Voluntary Agreement (IVA) with my creditors might be the way forward, but having no income and insufficient capital meant this was impossible. So it was off to a foreign land to live rent free in a friends house and use the house sale capital to pay the creditors off.

Avoidance is great, it is reassuring, it means not having to deal with the reality of a situation. Sadly, avoidance can only last so long. My capital was running out fast and there was only one thing to do. I came home and reached a financial settlement with my ex-wife. This gave me a bit more breathing space and I got a job at half of my last salary. Now things were going from bad to worse. The settlement soon ran out and I realised I need help.

The Consumer Credit Counselling Service (CCCS see link) were great. They helped to establish a realistic budget and talked me through my options. Their conclusion was that bankruptcy was the best way forward for me. So here I am adjudged bankrupt and attempting to pick up the pieces of my life to make a fresh start.

Next Year - Another Song - Hopeful?

2005-03-12T05:55:00.000Z

The video of this song contains images of the earth from the moon. I have that picture on my wall and it reminds me that my problems and difficulties are small and momentary in the bigger scheme of life.

If you click the title of this post you will be redirected to the Earthrise image from the Appolo 11 Mission .

Video code provided by MusicVideoCodes.com

Debtors Petition and Statement of Affairs Online

2005-03-12T04:33:00.000Z

Form filling seems to be a necessary evil with any sort of official application for help. With bankruptcy the forms enter the legal world of affidavits and petitions. When the County Court first sent me the forms and guidance notes my first reaction was to panic about the legal aspects. Unfortunately the guidance notes provided do not include any worked examples of how the forms might be completed.

The Debtors Petition (Form 6.27) had to be completed in triplicate and the Statement of Affairs (Debtors Petition)(Form 6.28)in duplicate. I didn't want to do this all by hand so downloaded the forms from the Insolvency Service website (click title of post), they have them in MS-Word and PDF formats. Completed my forms on the computer and let the printer worry about multiple copies.

Luckily I have a friend who is a solicitor who advised me on completing the legal parts of the documents. When I filed the documents at the county court I could that she was expecting the worse. However, to her surprise and my delight we discovered the forms were completed correctly. Amazingly she complemented me on filling the forms in correctly, stating that even the professionals usually make mistakes.

The Insolvency Service offers the following advice about form filling and filing:
"Note: The Insolvency Service and Official Receivers cannot provide legal or financial advice. You should seek this from a Citizens Advice Bureau, a solicitor, a qualified accountant, an authorised insolvency practitioner a licensed conveyancer or reputable financial adviser or advice centre."

So if you are in any doubt about completing the forms get help. If contacting your local Citizens Advice Bureau make sure you leave enough time to get an appointment.

I tried to send the following message to the Insolvency Service today, via their website but it seems they are having problems, so sent it by e-mail instead:

"Thank you for making the forms available online it is a very useful service. However, having just completed forms 6.27 and 6.28 I would like to suggest that some worked examples be given for the Petition and Affidavit. I know help in completing the forms can obtained from a CAB, Solicitor or Insolvency Practitioner, though a worked example or two for the affidavit and petition might save a lot of time for everyone.

Thank you"

This song gives me comfort

2005-03-12T01:40:00.000Z

Video code provided by MusicVideoCodes.com

Adjudged Bankrupt

2005-03-11T11:46:00.000Z

At long last after much agonising, worry and resignation, it has finally happened. On the 11th of March 2005 in my local County Court I was adjudged bankrupt.

This is my story of insolvency, bankruptcy and general indebtedness. Over the next few days I hope to share how I came to this point in my life and also inform others about the people who have been helpful in getting me through the process. The story will end when I am finally discharged from Bankruptcy which will not be later than the 11th of March 2006.

All the references here will be for Bankruptcy in England and Wales. The content is about personal bankruptcy, though comments are welcome from people who have experienced bankruptcy in it's other forms and jurisdictions.