Hello I currently have debts totalling 100k to 23 creditors due to a period out of work when our self employed premises were vandalised and insurance payout was less than hoped for. I am in full time work and currently up to date with mortage but over the past 3 years have had to borrow money off friends and family to allow us to clear mortgage arrears. I do not earn enough to have any chance of clearing the 100k of debts and just manage to keep the most persistent at bay with minimum payments of £5/10 so have always considered bankruptcy as an option. However it is the family/friends issue that concerns me. Both a friend and my mum took out personal loans in their own names to help us clear the mortgage arrears. We are just coping to give them the proper monthly repayment sums but feel that if the loans were in our name we probably would have defaulted on them or offered lower figures. Would we have to declare these loans to an Official Receiver if I file for bankruptcy? How could I explain the repayments to them otherwise? It should be noted that any equity I have in my house is more than covered by the number of charges on the house from some of the 23 creditors so there is no 'golden egg' to pay off the friend/mum never mind all the creditors. As my friend and mum are on low incomes themselves, and only did this out of the good of their hearts, I can't bear the thought of them being classed as 'creditors' and not being able to pay them back and suffer the burden of the loan themselves. Any help and advice appreciated!
yes officially you must declare all of your debts but if no written record how will the OR know.
the difficulty will be when the OR looks at your income and expenditure and only allows you a small amount of disposable income and you are then unable to pay your two special creditors.
I totally agree with your intentions to look after your family but the official receiver sees all creditors as the same equal standing.
I normally suggest to any poster on the forum, if you have more than one issue to be resolved before going BR then you should speak to one of the experts to the left (all highly recomended)
I used the services of Paul and his team at reviva and would strongly recomend them to other posters
You should disclose all your debts to the OR, and you should not make any repayments to any of your creditors once bankrupt as this is technically an offence.
It is understandable that you are concerned about your friends/family, but unfortunately the law doesn't allow you to pick and choose who you pay - you should treat all creditors equally
New Member, looking at bankruptcy options
Posted - 09 March 2010 : 13:10:47
