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kim221183
Starting Member
3 Posts |
 Posted - 04 January 2009 : 23:45:48
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| what is the point of going bankrupt if you have to pay huge payments to the courts each month. |
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John
New Member
United Kingdom
73 Posts |
Posted - 05 January 2009 : 00:10:02
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Hi
if your income and expenditure leaves a high monthly disposable income balance it's possible that an IPA could pay 100% of a bankrupt's debt.
But an IPA is limited to 3 years so most that have to pay into an IPA will not be required to pay in full and will almost certainly repay less than those in a DMP or IVA.
The point of declaring bankruptcy is to start afresh and in the main intended for those that cannot service monthly credit repayments.
As laws have to be set it is always going to be the case that a few will qualify for bankruptcy but don't really need it as they can afford the payments easily.
In this scenario you're right, there is little point.
In the insolvency industry people in this position are called won't pays as opposed to can't pays.
I would not recommend bankruptcy for anyone that can afford to pay their debts nor is bankruptcy itself intended for anyone in such a position.
www.Bankruptcyhelp.org.uk
0800 078 9367 |
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Needafriend
Junior Member
United Kingdom
344 Posts |
Posted - 05 January 2009 : 08:50:39
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Hi Kim
I wanted to add that since we went bankrupt we have had our lives back. Whilst i know that payments may have to be made to the OR for the max 3 years, the good thing about that is unlike an IVA or DMP they finish in the 3 years no more and if your income drops significantly it could be less.
It is also easier to have the payments adjusted throughout your IPA period if you change jobs, have another child, cost of living goes up.
I was in my own DMP which at the rate we could afford to pay would have taken 50 years to pay back and it nearly cost me my life and my marriage, thats why we went BR, it was the best choice and if we have to pay an IPA then i would be happy to do that, we had the money, so we should pay.
There are so many pro's to this but at the end of the day it has to be right for you.
I now have a life which i have not had for about 4-5 years. My kids have a Mum and my husband a wife.
Take care
Jo
x
22 Weeks down
30 to go
For more info on how i have come through bankruptcy and for links to help, you can read my blog here called:
Needafriend's Info on Bankruptcy :-)
http://debtfreejo.blogs.bankruptcyhelp.org.uk/
Needafriend says: Live life to the full, take life by the horns and live a little, otherwise life would be so boring! |
Edited by - Needafriend on 05 January 2009 08:51:31 |
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Trolly-Dolly
Average Member
591 Posts |
Posted - 05 January 2009 : 11:01:53
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Hi
A few people have asked me this question as our joint debt was £24,000. This may seem small to some but we were paying £1200 pm in debts, plus 2 small children and a mortgage on a high interest rate. We were -£1400 every month! So for us the best thing we could have done and the best lesson to be learnt.
You can read my blog here;
http://drowningmummy.blogs.iva.co.uk/ |
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debtrider
Junior Member
494 Posts |
Posted - 05 January 2009 : 13:40:28
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Hi Kim221183
You don’t necessarily have to pay huge amounts out each month if you go bankrupt.
It all depends on what disposable income you have. If you have more than £99 per month disposable income then 50% of this will go to into an IPA. So if you can keep your disposable income at around £99 then you will not be subject to an IPA.
Obviously this will not apply to everyone but it has to be better than an IVA which is takes all your disposable income or even a DMP in some instances.
Debtrider
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what is the point of going bankrupt
