In any circumstances would an OR allow a bankrupt to maintain a Car HP agreement through a bankruptcy proceeding. i.e. client requires the vehicle as a means to commute to work, no alternative means of transport (no public transport routes ect).
I heard recently of a similar case to this where the bankrupt was forced to return the car and therefore resign from her employment, meaning there was no IPA/O when without returning the car it would have been around the £300pm mark. The bankrupt was simply told to find employment closer to home.
the Official Receiver will accept you keeping a car on finance PROVIDED THAT
1. It is necessary for work - taxi , travelling sales etc etc etc
2. There are no other alternatives
3. The monthly HP payment is not excessive
4. It is not a posh car ( i.e. not a Porsche)
5. There is little or no equity.
In addition to the above you need to remember that even if the OR says yes then it is down to the HP company to say yes too. They will have a clause somewhere in the document to say that they have the right to cancel in the event of insolvency.
What sort of car is it, how much per month and which finance company is it with.
Finally are you sure it is HP rather than a Fixed Sum Loan Agreement?
Paul Johns Assisted Bankruptcy Specialists Reviva UK
Car HP in bankruptcy
Posted - 17 December 2008 : 16:05:13
