# Is there life after bankruptcy?



## Peter54 (23 Jan 2012)

Like other posters I have been contemplating filing for bankruptcy in the UK. I have been considering this option for well over a year. 

I had struggled to renegotiate all my personal debt and had to go overseas to engage with a debt management company. Within days the non secured debt was negotiated and I was put on a payment plan. Happy days I thought . . . Wrong!

I had to try and renegotiate my mortgage, which I was finding almost impossible to do; this was pre MARPs. My provider never offered me the option of a mortgage payment break and I continued paying interest and part capital each month. I was financially wiped out.

When MARPs was introduced in 2011 my provider agreed to allow me access to it. My situation has disapproved further and the bank are somewhat distancing themselves from my case. The inevitable repossession I am assuming is around the corner.

I have now broken my MARP agreement as I am trying to save what I can in the event I am put out of my home. There is no family I can turn too so I will be virtually homeless.

The debt management company is proposing I go bankrupt. I am aware of the positives of taking such action but am wary of the negatives.

All my life I have worked in the construction sector. My education is limited, apart from my trade. I am also in my late fifties. Does any of this make me a good candidate for bankruptcy?

I have been researching a business concept and have looked at obtaining a grant from EU funding. Did you know you are unable to do so if you are bankrupt?

I suppose I need convincing that bankruptcy is the answer. I am still unconvinced that declaring myself bankrupt and starting a fresh is as easy as we are lead to believe.


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## Bronte (24 Jan 2012)

Have you read the posts on bankruptcy, if going to the UK for a year means you lose your home, but you also don't have to repay any of your debts would that help you. 

You cannot afford your mortgage so there is no point in continuing to live there. You need to start afresh, even at you age, but particularly because of your age if the UK bankruptchy gets you sorted out within a year isn't that a good thing.  It won't be easy but I imagine it cannot be any worse than what you've been though in the last while.


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## Brendan Burgess (24 Jan 2012)

Peter

The alternative is to tell the lender that you are  handing back the keys and going to the UK. 

However, if they wish, you will gladly put it on the market for them and give it three months to sell. In return, you want them to write off the shortfall. 

I think that they will agree to you selling the house, but won't formally agree to writing off the shortfall.

However, when the new debt settlement legislation is brought in, you will be able to deal with the shortfall in a manageable way over 5 years. 

Brendan


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## Peter54 (24 Jan 2012)

Let's say for example I hand my keys back to the bank, they sell it for whatever is achieveable and there is 100k shortfall that I become liable for.

Does that shortfall become unsecured debt as it is no longer tied to the property?

If it becomes unsecured - is it possible I can hand the 100k debt to a debt management company to pay a token payment each month hense not having to go to the UK at all?


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## 44brendan (24 Jan 2012)

Yes it becomes unsecured debt. Be careful in any dealings with debt management companies. In your case why is there a need to go to a debt management company?
As Brendan B states, new legislation will shortly be in place to deal with situations such as yours. This will facilitate an option of dealing with this residual debt in line with your financial circumstances over a set period.


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## S.N.Dipity (25 Jan 2012)

Peter,
I am by no means an expert on this subject(but am in a similar situation & am therefore paying close attantion to what is being proposed) and based on the details of the proposals released today in relation to personal Debt it would be my understanding that the time for discharge from Debts in excess of €20k has only been reduced to 8 years from the current 12. The Bankruptcy period is 3 years, with the possible requirement that payments may be required for another 5 years.
I would suggest you contact a group like New Beginnings, FLAC or MABS who are more likely to give you unbiased & objective information.


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## frostie (4 Feb 2012)

Peter, how much is your full mortgage payment, mortgage details, how much are you paying to the debt management company? It may be the case that the debt management company has simply taken your current arrangement with your mortgage company as all that is required to be paid, because most of them will not speak to your mortgage company for you. Hard to give you proper advice without all the info, but as Brendan suggests, the new legislation should help, the bank will also look at your unsecured debt in terms of any write-off, ie they should not take a hit as a secured creditor, while you pay money to unsecured creditors. How much unsecured debt do you have? It's very easy to suggest bankruptcy, and while it could be an option, it isn't always the best option. Re bankruptcy, under UK legislation, in any business transctions you must declare that you are a bankrupt, while the bankruptcy is in force, so you would have to declare this to the funding body.

www.frost.ie


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