Bankruptcy is never going to be the same for everybody, because everyone's circumstances are different. Consequently, use these posts for guidance NOT advice.
The first thing I would suggest you do if bankruptcy has crossed your mind, is seek some professional advice. Your local Citizen's Advice Bureau are probably the best place to start and their advice is free. OK, with many of these places, you do have to go and sit amongst the great unwashed whilst you wait to be seen by a caseworker, but once you've got that initial meeting out of the way, you will work with someone on an appointment basis.
When I first went to my local CAB, it was the first day they were open after the Christmas holiday 2005. I was in employment, but my outgoings had become more than was coming in from my day job salary each month.
Most months I scraped by, having done web desgin for people part time, but this never was going to help me out of the hole I'd dug for myself.
My bank refused to help me survive Christmas by increasing my very small overdraft to cater for a cheque I'd put in just before the holiday, who's funds would not clear until after. This meant that payments for the end of the month would fail, incurring penalties at the bank etc.
The first thing I discussed with my caseworker, was how I would deal with my creditors, the largest of these being the bank who had just withdrawn their support.
Bankruptcy wasn't even discussed. We decided to write to the creditors and make an offer of reduced payments.
The CAB did this for me and the response from the creditors was pretty slow. It was easily the end of February before we'd heard from them all.
Most agreed to accept the amounts proposed except the bank (but it was too late for them to argue by now).
The credit cards agreed to freeze the interest on the outstanding amounts and accept payments that were approximately a third of what they should have been, but for a period of only six months.
In March, fate played a trick on me and the consequences were to put a completely different spin on the proceedings, as I was made redundant from my job.
With no other income but Jobseekers Allowance, I wasn't going to be able to keep to the payment agreements that had been accepted.
I'd spent some time in the previous months, doing research on the internet in case bankruptcy became an option.
I found very little to help me, one of the reasons I started this blog, because I think at least a little objective advice on a situation is better than none at all.
I'd also looked at the IVA which we keep seeing advertised on TV, but in this case not applicable, as you need to be in work to enter into one of those.
One of the reasons I chose bankruptcy, is the fact I have very little in the way of assets. I live in rented accomodation, I drive a 15 year old car and basically the only other thing I have is my PC.
Things you have to consider before going bankrupt include:
Your future credit rating will be in minus figures and will remain so for 6 years. I was told that some finance companies will deal with discharged bankrupts and the interest loading is 1 to 2% over the general odds you find in the market place.
You cannot be a director or treasurer of a company or "club" whilst you are bankrupt. If you can get it, any credit you try to obtain over £ 500 you must declare your bankruptcy status.
You cannot become an MP whilst bankrupt.
If you own property or have any "considerable" assets such as a new luxury car, you could lose it ( it can be sold to help pay some of your debts to your creditors).
Bankruptcy is not free. Currently in 2006 the charges are :
£ 150 court fee £ 325.00 Official Receivers fee. In certain cases you can get the £ 150 fee back from the court (in the case of unemployment for example). Telephone your local county court and ask for the leaflet on court fees. It contains the form you have to fill in to get the fee back.
Under any circumstances, you will have to pay both the fees on the day and in cash too ! The Official Receivers fee is non - negotiable
If you've made your mind up that bankruptcy is the course to follow, telephone your local county court and aske them to send you the forms pertaining to personal bankruptcy.
They are pretty weighty adding up to 12 or 13 sections and a bankruptcy petition, all in duplicate.
You can get help and advice filling in these forms from the Citizen's Advice Bureau, especially where the petition is concerned, as this is a legal document and therefore needs to be letter perfect.
The other forms are for your personal details and your assets. Again, you may need to seek advice. As well as property, savings etc, this is where you should declare other items of value, which the Official Receiver could consider valuable enough to order them sold to contribute to your indebtedness.
In my case, I declared my car and my PC. Neither were considered valuable enough to make any significant contribution to clearing my debts and so I was allowed to keep them. It was also discussed with the Official Receiver that both these items are used as tools in my job hunting activities.
You'll notice that there's a lot more mention of the Official Receiver in these notes, than the court and there's a very good reason for that.
Your dealings with the court will last a day or less. You will be given an appointment, you will turn up with all your forms completed, you will pay your fees.
After your forms have been given the once over, you will appear in front of the judge, who will decide whether your bankruptcy is appropriate.
He will look over your statement of affairs and will almost certainly ask you questions on how you decided to take this course of action and how you think you got into such a state of affairs in the first place. The questions are more to establish that you understand the importance of what you are doing, rather than ascertain your life history.
If your bankruptcy is agreed, you will be issued with your bankruptcy notice.
This is pretty much where the court's involvement with you ends. You will of course remain on record at the court as a bankrupt, but from the day of your bankruptcy onwards, your bankruptcy will be handled by the Official Receiver's office.
These days, because of the sheer numbers of personal bankruptcies, the once face to face interview with the Official Receiver, is now carried out on the telephone (in most cases).
Depending on the location of their office, the norm is for the court to fax over the pages of your financial statement and then telephone their office, where your initial interview will begin.
This is just to verify all the details in the statement are clear). A second appointment will be agreed again by telephone (where a senior official will go through your statement with a fine tooth comb). More about that in another posting.
Once your initial telephone interview is over, that is it for your day in court. You are free to go.
Freezing of bank accounts.
Neither the court or the Official Receiver has the power to freeze your bank account. Banks do this at their own discretion and in some cases will try to give you the impression they are doing so on the instructions of the Official Receiver.
Tuesday, August 29, 2006
Saturday, August 26, 2006
Not all the clowns are in the circus
Because the Halifax saw fit to sit on my money for over a week, I was late paying my bills, most of which go out around the 15th.
As soon as I got my wedge, I put it all onto my pre pay credit card (a useful thing for bankrupts to have). Once the funds cleared in this case, next day I set about paying some bills.
A priority was to pay my car insurance. I explained that I am setting up a bank account, but would like to offer a one off payment by credit card.
Checking details, the operator noted I was now unemployed. "That's a change in your circumstances and increases your premium by £ 36.00" she said coldly.
Confronted by such stupidity I told her that was the most appalling example of screwing the punter I've ever seen. Sensing my anger she went on to inform me that if I was unhappy about that and wished to cancel my policy, there would be a surcharge of £ 45.00.
Apparently, "Giro Kings" are a higher risk. I tried to reason that as I am on the dole, I am doing fewer miles per year and therefore in my opinion, should be a lower risk and therefore enjoy a lower premium. She was having none of it.
I am rarely rude to these call centre operators, but I saw this as yet another example of kicking someone when they are down, but incensed by the actions of Kwik Fit Insurance, I told her they would kiss my inwiped arsed before I renewed my policy next year.
I spoke to my brother later, who was in insurance for ten years and he agreed that this is the biggest load of bollocks he has ever heard.
I think it is fairly obvious, that despite hollow claims like "the customer is king", these organisations are interested in one thing. The pursuit of the buck, which they will take from the punter by fair means or foul.
Oh, to add insult to injury, when I had paide over my increased premium, the bitch tried to sell me home insurance !
So the TV commercial says "You can't get better than a Kwik Fit fitter..." I beg to differ.
As soon as I got my wedge, I put it all onto my pre pay credit card (a useful thing for bankrupts to have). Once the funds cleared in this case, next day I set about paying some bills.
A priority was to pay my car insurance. I explained that I am setting up a bank account, but would like to offer a one off payment by credit card.
Checking details, the operator noted I was now unemployed. "That's a change in your circumstances and increases your premium by £ 36.00" she said coldly.
Confronted by such stupidity I told her that was the most appalling example of screwing the punter I've ever seen. Sensing my anger she went on to inform me that if I was unhappy about that and wished to cancel my policy, there would be a surcharge of £ 45.00.
Apparently, "Giro Kings" are a higher risk. I tried to reason that as I am on the dole, I am doing fewer miles per year and therefore in my opinion, should be a lower risk and therefore enjoy a lower premium. She was having none of it.
I am rarely rude to these call centre operators, but I saw this as yet another example of kicking someone when they are down, but incensed by the actions of Kwik Fit Insurance, I told her they would kiss my inwiped arsed before I renewed my policy next year.
I spoke to my brother later, who was in insurance for ten years and he agreed that this is the biggest load of bollocks he has ever heard.
I think it is fairly obvious, that despite hollow claims like "the customer is king", these organisations are interested in one thing. The pursuit of the buck, which they will take from the punter by fair means or foul.
Oh, to add insult to injury, when I had paide over my increased premium, the bitch tried to sell me home insurance !
So the TV commercial says "You can't get better than a Kwik Fit fitter..." I beg to differ.
Friday, August 25, 2006
Who gives you extra ? Not the Halifax !
I've discovered since my bankruptcy hearing on August 3rd, that the banking industry treats bankrupts very much as lepers were treated in biblical times.
Before my hearing, I conducted a lot of research on the ramifications of bankruptcy, which included a chat to the Official Receivers office, who here in England become your "minders" for the period of your bankruptcy.
Firstly (and I can only comment on my dealings with them), they are truly professional, helpful and friendly. The office I deal with is based in Newcastle Staffs.
The first thing I learned before my hearing, is that neither the court or the Receiver's office have the power to freeze your bank account. Freezing and closing of accounts, is at the discretion of individual banks.
Though I thought it a naive move, I wrote to my bank HSBC the day before my hearing, advising them of my impending bankruptcy and making it plain that whilst I understood they might want to reduce the facilities offered me, I still needed to use my account to pay my bills and lodge cheques.
When I got home from court the next day, there was a letter from HSBC refusing my request.
Immediately the judge declares you bankrupt, your financial statement is faxed off to the Official Receivers office and shortly after, you take part in a telephone interview with them.
The receiver asked if I had any money in my bank account. I told her there was about a hundred pounds to cover direct debits going out in the next week. She told me to withdraw it the moment I left court (which I did).
The next day, I realised I needed to find banking facilities pronto and set about doing a little research using Google UK.
I found a lot of cowboys offering full banking facilities with the high street banks (for a hefty fee of course), which raises the question; If the high street banks are turning bankrupts away, why are they offering cheque books and credit cards galore via these internet Joey's?
I then found a BBC news article, which listed a number of banks who had been known to show sympathy towards bankrupts, with limited facilities. On the list, was the Halifax, whom I called.
The conversation went a little like this: "Morning, I have been recently declared as bankrupt and I am looking for limited banking facilities".
"No problem" came the reply and the young lady proceeded to advise me on the choice of accounts, which was two. One of these accounts could be set up on the phone (an Easy Cash account), and finalised by taking in some positive ID like your drivers licence to the chosen branch. I did this and about a week later, I received a PIN and a withdrawal card which I never got to use.
Two days later, I received a letter which said my bankruptcy had been reported in the London Gazette and in line with the Official Receiver's wishes, had been frozen.
Additionally, it was not the policy of the Halifax to offer banking privileges to bankrupts and so, once the account had been released, it would be closed.
Now you will recall, that I mentioned my pre bankruptcy research and the information the Official Receiver had given me over who it is who freezes bank accounts.
This strongly suggests that The Halifax are telling porkies when they say the account is frozen in line with the requirements of the Official Receiver.
I'm still waiting for a response on this one from their CEO.
My first move was to discuss this with my case officer at the receiver's office and she agreed with me, that this was ludicrous. My account with them had been set up quite legally, post my bankruptcy and was outside of their area of investigation, meaning they would not be writing to the Halifax enquiring as to what funds were in that account.
She very kindly wrote all this down in a fax instructing them to release this money to me, as it was classed as living expenses (quite true considering it was my Job Seekers Allowance).
With their help, I managed to retrieve my funds the next working day, with little or no fuss, but to date, I have no explanation as to why my account was processed and opened and then closed and furthermore, no apology from the Halifax for the extreme distress caused me.
As a fall out from this episode, my Vodafone was disconnected because I was unable to get at the cash to pay my August payment and it had a knock on effect with my car insurance, which is the next story in this journal of disservice.
I have set about writing to all the banks on the BBC web site listing, which admittedly was from three years ago and I shall be publishing their comments here as a guide to others in my position who are looking for a simple bank account.
I've discovered since my bankruptcy hearing on August 3rd, that the banking industry treats bankrupts very much as lepers were treated in biblical times.
Before my hearing, I conducted a lot of research on the ramifications of bankruptcy, which included a chat to the Official Receivers office, who here in England become your "minders" for the period of your bankruptcy.
Firstly (and I can only comment on my dealings with them), they are truly professional, helpful and friendly. The office I deal with is based in Newcastle Staffs.
The first thing I learned before my hearing, is that neither the court or the Receiver's office have the power to freeze your bank account. Freezing and closing of accounts, is at the discretion of individual banks.
Though I thought it a naive move, I wrote to my bank HSBC the day before my hearing, advising them of my impending bankruptcy and making it plain that whilst I understood they might want to reduce the facilities offered me, I still needed to use my account to pay my bills and lodge cheques.
When I got home from court the next day, there was a letter from HSBC refusing my request.
Immediately the judge declares you bankrupt, your financial statement is faxed off to the Official Receivers office and shortly after, you take part in a telephone interview with them.
The receiver asked if I had any money in my bank account. I told her there was about a hundred pounds to cover direct debits going out in the next week. She told me to withdraw it the moment I left court (which I did).
The next day, I realised I needed to find banking facilities pronto and set about doing a little research using Google UK.
I found a lot of cowboys offering full banking facilities with the high street banks (for a hefty fee of course), which raises the question; If the high street banks are turning bankrupts away, why are they offering cheque books and credit cards galore via these internet Joey's?
I then found a BBC news article, which listed a number of banks who had been known to show sympathy towards bankrupts, with limited facilities. On the list, was the Halifax, whom I called.
The conversation went a little like this: "Morning, I have been recently declared as bankrupt and I am looking for limited banking facilities".
"No problem" came the reply and the young lady proceeded to advise me on the choice of accounts, which was two. One of these accounts could be set up on the phone (an Easy Cash account), and finalised by taking in some positive ID like your drivers licence to the chosen branch. I did this and about a week later, I received a PIN and a withdrawal card which I never got to use.
Two days later, I received a letter which said my bankruptcy had been reported in the London Gazette and in line with the Official Receiver's wishes, had been frozen.
Additionally, it was not the policy of the Halifax to offer banking privileges to bankrupts and so, once the account had been released, it would be closed.
Now you will recall, that I mentioned my pre bankruptcy research and the information the Official Receiver had given me over who it is who freezes bank accounts.
This strongly suggests that The Halifax are telling porkies when they say the account is frozen in line with the requirements of the Official Receiver.
I'm still waiting for a response on this one from their CEO.
My first move was to discuss this with my case officer at the receiver's office and she agreed with me, that this was ludicrous. My account with them had been set up quite legally, post my bankruptcy and was outside of their area of investigation, meaning they would not be writing to the Halifax enquiring as to what funds were in that account.
She very kindly wrote all this down in a fax instructing them to release this money to me, as it was classed as living expenses (quite true considering it was my Job Seekers Allowance).
With their help, I managed to retrieve my funds the next working day, with little or no fuss, but to date, I have no explanation as to why my account was processed and opened and then closed and furthermore, no apology from the Halifax for the extreme distress caused me.
As a fall out from this episode, my Vodafone was disconnected because I was unable to get at the cash to pay my August payment and it had a knock on effect with my car insurance, which is the next story in this journal of disservice.
I have set about writing to all the banks on the BBC web site listing, which admittedly was from three years ago and I shall be publishing their comments here as a guide to others in my position who are looking for a simple bank account.
Thursday, August 24, 2006
Why this Blog ?
Less than a month ago, I was forced by circumstances to declare myself personally bankrupt. In addition to this, I find myself unemployed at 49 and whilst I have applied myself to the everyday tasks of keeping the wolves from the door on such a limited income, I am left feeling like a salmon swimming against the flow of the river when it comes to dealing with the large institutions we all have to deal with. We must pay our bills, yet quite often in our everyday attempts to do so, we fall foul of the "fuckwit factor".
Whilst I am not proposing to establish this as an advisory service for fellow bankrupts, if I can offer advice from my own experiences I will do so happily. I am also happy to hear from those who find themselves shortchanged by these so called professionals who spend so much time and advertising money boasting just how fucking great they are...
As part of my despair, I have ensured the CEO's of the organisations I have locked horns with in recent times are made aware both of how I feel, but also of the fact their inadequacies are reported online in the hopes of spreading the word of just how poor their organisations are at dealing with their customers.
I am not out to topple any organisation, I am simply wanting to alert those who stumble across this soapbox, to the shortcomings and dirty tricks employed by companies who's public image runs from squeaky clean to smug bastards in the general order of things.
This journal is published from the UK and because it is written from personal experience will almost certainly be about UK companies and all I am saying in these writings is "watch out" if you find yourself dealing with them.
Here endeth the first posting.
Less than a month ago, I was forced by circumstances to declare myself personally bankrupt. In addition to this, I find myself unemployed at 49 and whilst I have applied myself to the everyday tasks of keeping the wolves from the door on such a limited income, I am left feeling like a salmon swimming against the flow of the river when it comes to dealing with the large institutions we all have to deal with. We must pay our bills, yet quite often in our everyday attempts to do so, we fall foul of the "fuckwit factor".
Whilst I am not proposing to establish this as an advisory service for fellow bankrupts, if I can offer advice from my own experiences I will do so happily. I am also happy to hear from those who find themselves shortchanged by these so called professionals who spend so much time and advertising money boasting just how fucking great they are...
As part of my despair, I have ensured the CEO's of the organisations I have locked horns with in recent times are made aware both of how I feel, but also of the fact their inadequacies are reported online in the hopes of spreading the word of just how poor their organisations are at dealing with their customers.
I am not out to topple any organisation, I am simply wanting to alert those who stumble across this soapbox, to the shortcomings and dirty tricks employed by companies who's public image runs from squeaky clean to smug bastards in the general order of things.
This journal is published from the UK and because it is written from personal experience will almost certainly be about UK companies and all I am saying in these writings is "watch out" if you find yourself dealing with them.
Here endeth the first posting.
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