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| T O P I C R E V I E W |
| tinkie |
Posted - 30 July 2009 : 18:19:48
My situation is this,
seperated from husband in july 2007,
started divorce proceedings july 2008,
Joint secured loan he not paying his half so went for financial court october 2008
Husband didn't attend 1st appt in jan
Husband didn't attend 1st appt in april when judge ruled house to be sold and that after it was he would be liable for all outstanding debt.
So in april as I had several thousand pounds worth of debt on credit cards including a large amount as a second card holder on my mums credit card (She has never spent a penny on these cards it was just me), so I got a consolidation loan to pay all of this off as I was just paying the minimum amount each month.
June finally got access to property and he hasn't paid anything since january 2009 so the house is getting reposessed.
Mid june spoke to solicitor to get them to stop the repo so I can get my money, they said they can't help and that now my ex is not working I will have to pay all the debt as although the court order says he is responsible, it means he has to pay me back.
He then did a flit, had already stopped paying everything
July took advice from CCCS who say bankruptcy is best option.
My real question is this, will there be questions asked about the consolidation loan paying off my mums credit card (although I spent it) even though I did this when bankruptcy wasn't even forseen as a possibility in my wildest nightmares, and secondly if there are questions asked what are the possible repercussions?
Hope this makes some sense.
Thanks in advance for your help. |
| 5 L A T E S T R E P L I E S (Newest First) |
| gettingoutofdebt |
Posted - 31 July 2009 : 07:53:01
If you paid off each creditor on a pro-rata basis of the outstanding debt then there aren't any problems.
Creditor favouritism means that you pay off some creditors but not others. It looks like you paid off 4 cards (2 of your mother's) and then didn't pay off one card (£1400) so this is creditor favouritism although you could argue that these were a higher rate of interest.
As you have paid 2 of your own cards as well as 2 of your mother's then it won't look too bad to the OR. If you had only paid your mother's card and not your own then there would be a very good chance that the OR would want this money back.
You may get a slapped wrist for not paying one of your cards off and there is a section in the SOA (BR forms) that asks if you have made additional payments to some creditors and not others so you would need to put the details in this section as you didn't pay the £1400 card off. As these cards had a higher rate of interest you could mention this to the OR when they ask why you paid these cards off and not the other one.
Unfortunately there is no guarantee of what the OR will do. The OR follows guidelines rather than rules that are set in stone and these are open to different interpretation although from what you have said I would find it highly unlikely that the OR would want to reclaim some of the money from your mother.
On another note if your overall debt is less than £15k (£10.5k loan and £1.4k CC are there other debts?) you may be eligible for a Debt Relief Order (DRO) if you meet the criteria:
- you have debts of £15,000 or less.
- you have spare available income of £50 or less a month after paying your normal household expenses
- the things you own (your assets) and any savings are worth £300 or less. However, if you have a motor vehicle, this must be worth £1,000 or less unless it has been specially adapted because you have a physical disability
If it looks like you meet this criteria then a DRO costs £90 and you can apply via the CAB. It is a better alternative to bankruptcy and is something that has only been available since April 2009. |
| tinkie |
Posted - 31 July 2009 : 00:22:37
can i just check this with you at the time borrowed 10500
Payed 5898 off mum card 1
payed 2500 off mum card 2
payed 1800 off my card 1
payed 500 off my card 2
Used the rest for divorce fees.
I still had an outstanding c card of 1400 but as this on was dormant from a long time ago i chose to keep paying my 50 per month off it. I chose to pay off the cards that were costing me the most money each month so that the total payment for the loan was similar to the combined monthly payments but allowed me to pay it off in 5 yrs instead of about 50. I should also point out that I was still solvent at this time, hence my being able to get credit.
Is this still okay? |
| gettingoutofdebt |
Posted - 30 July 2009 : 19:45:20
If you were a 2nd card holder rather than a joint account holder then your mother would have been liable for the debts if they weren't paid. In this respect it could be seen that you were paying your mother's debts.
Normally the OR would only expect the money back if you have paid a creditor and not paid any others. You have paid your credit cards as well as your mother's so there isn't any favouritism. If you had paid you mother's card and not your then the OR would have a good case for wanting the money back from your mother. |
| tinkie |
Posted - 30 July 2009 : 18:36:44
thanks so much for your reply, don't so much mind repercussions to me, but on another site people have alluded to the fact that my mum will be asked to pay the money back. And thats the only thing I am concerned about because obviously she couldn't. So is that not so?
Thanks
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| gettingoutofdebt |
Posted - 30 July 2009 : 18:32:06
Hi Tinkie,
It sounds like you have been through a really rough patch over the last couple of years.
The OR will want to know about your mother's credit card but if you are a second holder then were able to use it for yourself so paying this off shouldn't be a problem. During the OR's interview you will just have to tell the OR that all of the credit card debts were yours.
The consolidation loan was only taken a couple of months ago so this 'may' be an issue with the OR as it could look like you never intended to pay the loan off however if you explain the circumstances it should be ok.
The worst that the OR can do is implement a BRU, which increases the bankruptcy restrictions (can't be a director of a company, charity trustee, etc.) for a certain period of time so it is not the end of the world. They cannot put you in prison and you would still be discharged from BR after 12 months, it would just be the restrictions that lasted longer.
You may also want to contact some of the professionals that post on this board. They offer free advice and will only charge if you want their assistance in completing the BR forms or even accompanying you to court on the day:
Reviva UK: http://www.revivauk.com/
Jones Giles - http://www.jonesgiles.co.uk/ |
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