# Overwhelming business & personal debt: solutions? including UK bankrupcy.



## newlife

It is my first time here and after reading many posts I am now even more confused! I am looking for good solid factual advice. 

I am a 38 year old woman who ran her own business all her life up until 2009 when I had to close down. 

After a short period (about 2 months) on the dole I found work. 

With the help of MABS I have an Income/expenditure form to show where all the money goes, at the end after expenditures, there is approx. €150.00 p.m shared out to a few debtors. 

This will mean I will NEVER be able to repay my debts. 

I have a mortgage for €275k on a house that is worth approx. €180k now. I also have two Judgements on my home at present for €30k and another one for €65k pending (not registered yet), plus about another €150k in other unsecured debts (includes approx. €40k to Revenue).

I commute to work every day (about 3 hours travelling) and am totally depressed and exhausted. By neighbourhood has drastically changed over the past few years (for some reason my neighbouring houses are all rented now by a mixture of very inconsiderate and unpleasant characters and I HATE coming home. My quality of life is work, come home & close the curtains and sleep, work, sleep, work, sleep. If I continue like this I will simply have nervous breakdown. 

I don't know what to do. I have been harassed by many shady collectors including well known 'celebrity' debt collection agencies (if you know what I mean). 

I am considering going Bankrupt or handing back my keys or moving and renting closer to work (but I would not rent my house for more then €700 if I was lucky and Mortgage is €1100 pm). 

What is the point of killing myself working and commuting for a house I hate and cant sell when maybe in five years or so I will be forced to sell by one of my Judgement orders? It appears I could be thrown out when my mortgage decreases, so maybe in 20 years when mortgage is finally paid off and I am thrown out and have nowhere to live? 

Any good solid advice would be most gratefully received, what would you do?


----------



## Brendan Burgess

Hi newlife 

It seems clear to me that you are bankrupt. If I understand the figures correctly, you have a house worth €180k and you owe about €520k. 

You are unable to keep up even the minimum repayments on this debt. 

I think you need to talk to your mortgage lender and tell them that you intend to file for  bankruptcy but you are happy to surrender the house to them voluntarily.  Alternatively, they will ask you to stay in the house until it is sold. 

That is a decision you need to make. If you can rent closer to your work, well maybe that is what you have to do and try to sell the house. 

Bankruptcy in Ireland is a very difficult process compared to the UK. I think you need to go to England or Northern Ireland and become bankrupt there. You will get a fresh start after about 18 months. 

The alternative is to wait for new legislation to update bankruptcy laws in Ireland. However, you could be waiting a long time for that to happen and it may be that the UK system will still be more attractive.

Brendan


----------



## newlife

Hi Brendan,
Thanks for your reply. I am not sure which option you mean exactly?
If I go to the UK, I presume my house will be repossessed. If I move closer to work and rent my house will have to be repossessed also as I cant afford to pay the mortgage also and renting will be too little. Which do you think is a better option?
Kind Regards


----------



## PaddyBloggit

Moving to UK or Northern Ireland to declare bankruptcy is your best option.


----------



## newlife

I went to Free Legal Advice service recently and they told me that Bankruptcy in the UK was not an option. In fact the lady solicitor was quite rude and unhelpful about my situation and said, 'Well, if in 10 years they take your house to pay off some of your debts would that not be a good thing? At least you will have paid some of what you owe back!'
The Irish mentality to debt appears very different to that of the UK.


----------



## PaddyBloggit

Have a look at all the threads that discuss bankruptcy in the UK/Northern Ireland:



They are all worth a careful read.

Re. the Free Legal Advice lady ... forget her .... read the above and make your own informed decision on the matter.


----------



## burnt-toast

newlife said:


> I went to Free Legal Advice service recently and they told me that Bankruptcy in the UK was not an option. In fact the lady solicitor was quite rude and unhelpful about my situation and said, 'Well, if in 10 years they take your house to pay off some of your debts would that not be a good thing? At least you will have paid some of what you owe back!'
> The Irish mentality to debt appears very different to that of the UK.



This is absolute nonsense, shame on her!
If you go bankrupt in the UK you need to prove that your centre of main interest is in the UK, which means you need to live there for at least 6 months, have a job/be claiming benefits and have a lease agreement.

It costs around £750 to go bankrupt, you can do it in a day and you don't have to go to a court room to do it. Most people are discharged after 6-12 months, although you have to continue making token payments to your creditors for 3 years from the date your bankruptcy is granted (you're allowed I think £50 disposable income after reasonable household and personal expenses). You should be able to come back to Ireland once your bankruptcy has been discharged and the banks won't be able to touch you.

If I were you i'd go down this route. You sound like you're at the end of your tether! Do you have any family or friends in the UK or Northern Ireland who could put you up?


----------



## newlife

Hi 'burnt-toast', thank you for your reply,
Yes I do feel a little at the end of my tether! I have had such conflicting advice and opinions that I really dont know what to do. 
I have a friend who might put me up very temporarily till I found something of my own but it would not be a long time solution. I was born in the UK so I dont know if that is any advantage? 
It appears going to the UK is something I need to strongly consider but I guess I am nervous about finding work over there, my own place, etc, etc.
On the plus I dont have any kids and I am young and healthy so I guess now would be the time to do it rather then waiting another ten years!


----------



## PaddyBloggit

Go for it .... and have a new life newlife!


----------



## Guest105

newlife said:


> I went to Free Legal Advice service recently and they told me that Bankruptcy in the UK was not an option. In fact the lady solicitor was quite rude and unhelpful about my situation and said, 'Well, if in 10 years they take your house to pay off some of your debts would that not be a good thing? At least you will have paid some of what you owe back!'
> The Irish mentality to debt appears very different to that of the UK.



Ignore the lady solicitor and have a look a the following website some great tips here for you  [broken link removed]



> I am getting a large number of calls from Eire citizens who are seeking help in deciding whether or not to go bankrupt. My articles on the possibility of going bankrupt can bee seen on article base and these are being found on internet searches by those in Ireland with huge property debt.
> The economic situation in Ireland is pretty grim. I am currently advising individuals with debts in excess of £15 million, although many citizens have debt of much lesser sums.
> The main feature that every one has is that they own their own main and family home, but also a small portfolio of buy to let property.
> The issue with the by to let situation is that the rental yields that are being generated from the buy to let are not sufficient to cover the sums due on the mortgages each month. I have one client who is now being taken through bankruptcy who was struggling to make up shortfalls on his buy to let mortgages of €1000 per month. He had kept this going for a year before he had used up all his savings and still found that these losses were continuing and that the value of the property he was looking to keep had halved in value.
> I am helping him through bankruptcy here in the UK. He has relocated here to England and is in then process of establishing his COMI, which is making England his centre of main interest. He has obtained an NI number, a bank account and is working here in England.
> He has no wish to retain any property in Ireland and so he is giving notice to his tenants to quit the rental property. He has advised his bank in writing that he has relocated to England and he will hand the keys to all his property back to the bank. When he goes bankrupt here, any money that is owed to the banks will be written off, irrespective of whether the property has been sold by the bank at that time or not. As and when the banks crystallise their loss on sale they will merely advise the Official Receiver here in the UK of the amount of the shortfall on the mortgage.
> It is possible to keep a family home.
> It is the bankrupts share in any property which becomes vested in the Official Receiver. If a wife has a half share of the property, and wishes to keep the house, she can ask for her husbands share to be sold or transferred to her. If there is equity she can buy that equity out. If the house is jointly held that would equate to half the equity.
> If the property is in negative equity she can arrange to take the house back for just legal fees. It must be born in mind that she will take on the whole mortgage subject to all the negative equity.
> Where the house is simply held in the bankrupts name and the wife wants to stay in the property, it might be possible to do a deal with the mortgage provider for them to write off negative equity in return for the wife taking on a new mortgage.



Read more: http://www.articlesbase.com/mortgag...in-a-uk-bankruptcy-5062315.html#ixzz1UHvcAmD2 
Under Creative Commons License: Attribution No Derivatives


----------



## newlife

Thanks Paddybloggit, I am strongly considering it!
Cashier, I will definitely read up more on these articles, very informative, Thank you.


----------



## Brendan Burgess

newlife said:


> I went to Free Legal Advice service recently and they told me that Bankruptcy in the UK was not an option. In fact the lady solicitor was quite rude and unhelpful about my situation and said, 'Well, if in 10 years they take your house to pay off some of your debts would that not be a good thing? At least you will have paid some of what you owe back!'
> The Irish mentality to debt appears very different to that of the UK.



With respect, the FLAC advisors tend to know their stuff. I would guess that you misunderstood or that you have misquoted the advisor. 

Brendan


----------



## newlife

Hi Brendan,
I honestly don't think so, as I asked her a number of times so as to get a clear and concise response from her. Also, I had a friend with me, exactly for that reason, in case I misunderstood what facts I was told. We both understood it and heard it the same way. Anyhow, it was clear as day that she was very dismissive and against the idea for some reason. What she said actually, to clarify was; 'No that would not be possible for you' and I pressed further and said I had heard of many moving to England for this reason, she laughed and added, 'Well, it might be possible but only if you have debt in the UK as well as in Ireland.' I again asked was she 100% sure of this as I was hearing conflicting advice and she said she was sure. 
Also, as a point of interest, 6 months previous I visited another FLAC advisor, and this time I was very enthusiastically advised to go bankrupt in Ireland (and again had a friend with me). 
Therefore, it appears from my experience that the advice I am getting from them is very conflicted and varied. Tomorrow, I am paying to get the advice of a independent solicitor and it will be interesting to see if it has been so far a case of 'if you pay peanuts... you get monkeys?'


----------



## Guest105

Let us know how you get on tomorrow as I am sure there are many in the same boat as yourself.


----------



## oldnick

newlife -a couple of points..

-Although not necessary for UK bankruptcy being a UK citizen may mean you could could have an easier passage thru the local UK bankruptcy court. You're entitled to a British passport.Get one from the UK embassy in Dublin.

- On the thread "walking away from debt" there's a post number 71 from some guy,Steve Thatcher, who says he'll offer anyone free advice. 

- and , believe or not, you are a young person.  Someone in their teens may not think so, but to someone like me, nearly 30 yrs older,  you are very young . I so envy you those thirty years in which you can do so many things.


----------



## Jim2007

newlife said:


> Hi Brendan,
> I honestly don't think so, as I asked her a number of times so as to get a clear and concise response from her. Also, I had a friend with me, exactly for that reason, in case I misunderstood what facts I was told. We both understood it and heard it the same way. Anyhow, it was clear as day that she was very dismissive and against the idea for some reason. What she said actually, to clarify was; 'No that would not be possible for you' and I pressed further and said I had heard of many moving to England for this reason, she laughed and added, 'Well, it might be possible but only if you have debt in the UK as well as in Ireland.' I again asked was she 100% sure of this as I was hearing conflicting advice and she said she was sure.
> Also, as a point of interest, 6 months previous I visited another FLAC advisor, and this time I was very enthusiastically advised to go bankrupt in Ireland (and again had a friend with me).
> Therefore, it appears from my experience that the advice I am getting from them is very conflicted and varied. Tomorrow, I am paying to get the advice of a independent solicitor and it will be interesting to see if it has been so far a case of 'if you pay peanuts... you get monkeys?'



Like Brendan, I would be hesitant to dismiss the advice given to you out of hand, if for no other reason that the person you spoke to should be in a better position than us to assess your situation.  So I think it is a very good idea that your are seeking independent advice and I would suggest that you ask the solicitor to summarise his advice in a letter to you, so that you have a solid basis for making your decision.

Good luck with whatever you decide,

Jim.


----------



## newlife

Hi Jim, thanks for your post. 
I agree completely, I am definitely NOT 'dismissing the advice given to me out of hand', which is why I am meeting today with another solicitor, so as to confirm the facts one way or another. But I am sure you can understand my confusion when I have received completely conflicting advice from two FLAC advisors. Well lets see what today brings! I have already emailed him all my queries and I will post here and report the advice given.

'Old Nick', Thanks kindly for your post also,
I appreciate any advice. I will definitely try to contact that fellow Steve Thatcher, and see what he says. As to age, you are right, we never appreciate things properly at the time. I guess I am still young, deep down I now I have to do this now or I will let my opportunity pass but I have to be honest I am scared. I guess we get comfortable in what we know. But I guess the only thing to fear is fear itself! Thanks again.


----------



## Bronte

newlife said:


> What is the point of killing myself working and commuting for a house I hate and cant sell when maybe in five years or so I will be forced to sell by one of my Judgement orders? It appears I could be thrown out when my mortgage decreases, so maybe in 20 years when mortgage is finally paid off and I am thrown out and have nowhere to live?


 
That is precisely what would happen to you if you stay and continue to pay back your debts.  The minute your house is equal to your debts they will sell it.  That is the reason for seeking the judgement orders.  

Interestingly the costs of going to court for those judgements seems to be a wasted efford as you are already in massive negative equity.  Wonder why a financial institution has done that.

You asked the question 'what would you do?'  The UK bankruptcy route is all that is viable for you.  It would be really great if you post back the advice you are given for others on here who cannot afford to seek advice.    The only other think you could do is stop paying everything and let them take the house from you or hand back the keys.  With the debt you have it is pointless.  

One question, the two debts of 30K and 65K were they for the business and did you give personal guarantees?


----------



## Steve Thatcher

Hello newlife. I am sorry to read about your situation. You seem to have had conflicting advice from FLA, neither of which was very helpful for you.
In short I would not countenance going bankrupt in Ireland. Here is a helpful link to an article I have posted on the net about the contrasts between the UK and Irish bankruptcy regimes.
Askaboutmoney.com      >        > Mortgage arrears, personal debt & negative equity       > Key Post A comparison of UK and Irish bankruptcy procedures

You are very insolvent and I do think that bankruptcy is the right thing for you.

Here in the UK it is a favoured jurisdiction for anyone in the EU looking to divest themselves of debt, no matter where that debt was built up in the UK, simply because we view bankruptcy as a way to get someone economically active again and free from debts they will never pay back. Other regimes still seem to see bankruptcy as a mechanism to extract costs and fees and as a blunt debt collection tool for a creditor.

To go bankrupt in England, you will need to establish you centre of main interest here. That essentially means you will need to uproot yourselves and come and live here. That period of residency could be anything from 3-6 months, and then you can apply for your bankruptcy. You will need to get a National Insurance Number, which is pretty straightforward, get an address, from which you can get a bank account. With all these in place you are well on the way to proving you are materially here.

It doesn't matter that all your debt is in Ireland. What is clear from judicial statements is that it matters not where your debts were built up, or even if you move to the UK just for the purpose of going bankrupt, it is the fact of being materially resident here that qualifies you for the ability to declare bankruptcy.

Please feel free to post back any other questions.
 I really hope that you get this advice today. 

It does seem that many advisors are not sufficiently aware of the rights of Eire citizens when it comes to UK bankruptcy.

Good Luck 

Steve


----------



## newlife

Hi Steve,
Thank you for your reply. I am back on here after dismissing the idea for a bit, mainly out of fear and in the hope something would magically present itself. Unfortunately the only thing that has happened has been more court appearances, judgements and more stress. 
So this time determined to go.
My questions are the following,
I am currently working and paying off reduced mortgage payments as fell into arrears.
what is procedure for going England and bankrupt? Should I just post keys to bank when leaving? Should I stop paying and let them reposess, but if I am currently working, will I get into trouble?
Or should I tell them my plans?
Just confused about initial steps to take with my house and how to go about it!


----------



## newlife

Hi Bronte, back on here after few months trying to avoid reality. Have made up my mind now to do it. The two debts are for previous business I had before I had to close down.  I don't think I gave personal guarantees, but I was a sole trader at the time not a limited company. Both of these are now registered judgment mortgages.


----------



## newlife

Also what is the difference between secure or unsecured debts? Which ones are not covered by bankruptcy and would my house be one if I just handed back keys?


----------



## so-crates

Secured debts are those debts which, like your mortgage, are backed by an asset. Unsecured are not backed by an asset. However some of you debt which was unsecured is now secured by the mechanism of the judgement mortgage.

Bankruptcy should cover all your debts.

Would your house be one what? The mortgages on your house are secured to that house irrespective of who you give the keys to ("hand back" is incorrect unless the bank sold the house to you).


----------



## newlife

Hi so - crates,
think I read somewhere bankruptcy only covers unsecured debts. 
So would it not cover mortgage? But if u give back keys then what? Or is it better to be evicted?


----------



## so-crates

That is not my understanding of bankruptcy but the family home is afforded more protection under the law than other debts. Have a read through the articles here

http://www.citizensinformation.ie/en/money_and_tax/personal_finance/debt/

Like I said you can't "give back" the keys to the bank, the bank never owned your property and they didn't sell it to you. If you opt to surrender possession of your home to the bank, the bank try to sell it to recoup the money owed, it is usually not considered a good idea because the bank will generally go for a quick sale and will not get the best price for it - so you end up owing more than if you sold it yourself. The amount outstanding is still owed by you but would be unsecured as there would be nothing to secure it against. Judgement mortgages complicate that picture.


----------



## iamthemoney

newlife said:


> Hi so - crates,
> think I read somewhere bankruptcy only covers unsecured debts.
> So would it not cover mortgage? But if u give back keys then what? Or is it better to be evicted?



hi just read through all this thread, OP considering the amount of debt , if i was in your shoes, i would immediately stop paying all debts, mortgage etc and build up some cash , in order to get yourself started, and established in the uk.. then declare bankrupt....

it is an unfortunate situation that you are in, and I wish you the best, however , remember this, you are not the only one, there are many others in a worse off state than you..   make 2012 the year of change, and to get yourself sorted ..  it is hard indeed but by putting it off, you are only postponing the               inevitable and adding extra charges, and stress and worry.

I wish you all the best ,


----------



## Artemis

Hi Newlife, I am in the same situation, probably about 9 months behind you. My plan is my kilds will start the next school year in the UK(no sure about the North or London, depends where I can get some work.  I am going to start working on my COMI now, opening a bank account, social security number ect. 

It would be nice to hear from some people who have gone through the process. My own feeling is that people are waiting to see what the new insolvency legislation offers. 

Best of luck if you go ahead with it.


----------



## Bronte

newlife said:


> Hi Bronte, back on here after few months trying to avoid reality. Have made up my mind now to do it. The two debts are for previous business I had before I had to close down. I don't think I gave personal guarantees, but I was a sole trader at the time not a limited company. Both of these are now registered judgment mortgages.


 
Hi Newlife, thought you'd be writing to us from the UK by now.  Why on earth did you not go?  Maybe the stress is wearing you down and you are unable to make decisions.  Unable to see what you need to do.  You certainly ought to make a new life for yourself.  Steve Thatcher knows his stuff on UK bankruptcy, I recommend you contact him, he seems to have a lot of Irish clients, plus he has been very informative and helpful on here and believe me there are lot of Irish people going down the UK bankruptcy route as our government cannot seem to get it's act together on reforming our draconian system of 12 year bankruptcy only available to the wealthy.  

After you've settled in the UK and are fully discharged with your business experience and even with your going into debt experience you can start a new business.  Make the decision now to free yourself from the hell you must be in.  

Did you go to a solicitior and did you get proper advice on the UK route.  I'd be surprised if there were many Irish solicitors who know about UK bankruptcy.  Please post back on the progress you make and read the posts on here on Uk bankruptcy or read the papers which were full of an another Irish developer who's gone down the UK bankruptcy route.  Those boys are smart follow where they go, they have the best advice, just copy them.


----------



## newlife

Hi again so-crates,
Thank you so much for your advice here and apologies if i appear a bit slow at grasping the info. my brain is fried at this point!
You say if I 'give back the keys' so to speak, (I understand what your saying here, and believe me if i could sell i would) then the bank will sell and I will of course be left with the short fall. This becomes, as you say 'unsecured' debt,because I no longer have an asset. Therefore my question is, is that not okay for me if I plan to go bankrupt? Also, I have three judgements now on my home, can I do that still?
Just trying to understand how to go about it, do I tell the bank my plans or not? 
Thank you for your time, 
Newlife


----------



## ajapale

Could posters keep this thread to discuss  's query? Thanks

Some off topic and generalised posts moved to : UK Bankrupcy and related issues split from existing thread.

aj
moderator.


----------



## newlife

iamthemoney said:


> hi just read through all this thread, OP considering the amount of debt , if i was in your shoes, i would immediately stop paying all debts, mortgage etc and build up some cash , in order to get yourself started, and established in the uk.. then declare bankrupt....



Hi and thanks for your words,
I am determined to make this year a better one then the last!
regarding your comment, I was thinking the same but am a bit nervous of doing so. I was worried that may appear as 'fraudulent'or something, seen as still working and paying 'most' daily bills at moment.
I also am paying a few of my debts, a small monthly arrangement and i also have recently been given a court order to pay one of them, and think another one coming soon as have to go to court again in two weeks.
Therefore i am worried particularly about these, what would happen if i didnt pay them? And if i left country and went to England in the months establishing my COMI, would I not be still liable to pay these?
pheeew, what a nightmare!
Thanks in advance,
newlife


----------



## newlife

Artemis said:


> Hi Newlife, I am in the same situation, probably about 9 months behind you. My plan is my kilds will start the next school year in the UK(no sure about the North or London, depends where I can get some work.  I am going to start working on my COMI now, opening a bank account, social security number ect.



It would be nice to hear from some people who have gone through the process. My own feeling is that people are waiting to see what the new insolvency legislation offers. 

Hi Artemis,
thanks for support and sorry to hear you are in the same boat as myself,
(I guess I am lucky, as I dont have kids), must be even harder for yourself.
You say you are going to start working on your COMI, etc. Can you do some of that from here? or do you have to wait until you move over?
I am trying to plan move for Summer, but need to sort out house, etc first.
thanks Newlife


----------



## newlife

Hi Bronte,
Thank you so much for your kind and encouraging words.
Yes, i have delayed my progress, due to ridiculous rationalizing and trying to make believe it would just go away, but its not.
Had a humiliating morning in court about a month ago, with all the local gossips and many previous Solicitors I used to do business, enjoy and revel in my embarrasment and tears when the Judge decided to give me a Court order to pay a monthly amount, to one of my debtors (electricity company) even after seeing my Statement of Means (helped by Mabs) showing already a minus figure.
Also, I spent €350 for a 45min consultation, (after talking twice to Free legal Aid also) with a leading Solicitor Firm in Dublin which was a total waste of time and money.
Could get no concrete answers from them and they offered no advice for UK and Bankruptcy, only saying they could of course recommend a good UK advice firm).
i give up...
Determined to go and start afresh,
will definitely speak to Steve Thatcher,
Thanks so much,
Newlife


----------



## Bronte

newlife said:


> Yes, i have delayed my progress, due to ridiculous rationalizing and trying to make believe it would just go away, but its not.
> Had a humiliating morning in court about a month ago, with all the local gossips and many previous Solicitors I used to do business, enjoy and revel in my embarrasment and tears when the Judge decided to give me a Court order to pay a monthly amount,


 
That's very sad Newlife.  Why don't you start today to make the new life for yourself.  Contact Steve Thatcher, read his posts, they are most informative.  Ask questions on here.  

It seems to me you need to get away from small town Ireland, for a year or two.  It will give you a clearer head in a country that does not judge you on whether you are a bankrupt or not. 

What you need to do is pack up your belongings and just go, that's a start, then you can in the UK let the receiver/bankrupcy process deal with all your creditors including your mortgage bank.   The first step is the hardest, moving to the UK.  It is not fraudulent, you are legally entitled to do this.    Probably because you are so stressed, and maybe freightened of going to the UK, could you try to think of what the worst possible thing a bank/creditor can do to you that they haven't already done, and they have done their worst believe me, and work back from that.  You're already at the worst point, making the decision to go will be the best decision you will make because there is absolutely no way you will ever be able to get out of the financial mess you are in other than to go bankrupt UK style.  There is no need for you to endure any more pain.  

Get some money together, take all your belongings, rent in the UK, try and get a job and apply for bankruptcy.


----------



## newlife

Hi and thanks,
Sorry again to keep looking for clarification but if I go to UK, do I still have to pay Court Order installments in the interim before Bankruptcy?
Also, if I stop paying mortgage etc now so as to build up some cash, can I get into trouble as they would know I am still working?
Also, can I set up Bank account, identity number, etc from here or do I need a UK address to be living at before I can start?
Also, if I apply for a Job in the Uk from here do i have to have a UK address at the time?
I am sure will think of more questions soon!
Thanks...


----------



## Bronte

Obviously you can apply for a job in the UK from Ireland.  You will need to get the equivelent of a PRSI number when you go there, that should be a fairly simple procedure for an Irish person.  Every large city in Ireland has an office to help people moving abroad.  Not sure anymore what they are called but your local citizen's advice center should know.  Also I think  on AAM there are specific threads on moving to different countries.  

You'll need a deposit, rent for a few months, or I guess you can go on the dole over there to start off with until you find a job.  Also in London there is an Irish center, you could make contact there, maybe they have Irish people who need someone to houseshare.  Do you not know anyone in London, relations, grand aunt etc.  Being logical you need to have some money, 3 to 6 months worth.  If that means you cease paying your mortgage so be it.  All they will do initially is send you letters.  I would continue with the court ordered instalments until you leave.  Have you read all the informative posts on here on this issue of UK bankruptcy.


----------



## Steve Thatcher

Hello newlife, I am sorry that you were not able to resolve matters.
So you are off the the UK. 
Your main concern is the house. In simple terms you can do any of the things with the house that you mentioned.
It is simplest to tell the bank your plans. I suspect that this will be the norm now after the Sean Quinn jdgment.They can then ask you to hand the keys back or take steps to repossess. There is no point in paying a mortgage on a property which you are not going to own. It makes no difference to you if your mortgage shortfall is €275k or €285k. 
You can go bankrupt even if the shortfall on the mortgage is not known. If the property is still in your name when you go bankrupt, it will vest in the Official Receiver (official assignee). He will hand it back to the bank to sell and he will write off any shortfall in due course.
You will be bankrupt for just a year. Even if your property has not been dealt with by time you are out of bankruptcy, you are still not liable for the losses.

Let me know if I can help further

Steve


----------



## Bronte

Steve, have you any idea what Newlife should do about the court ordered instalment order?  Should she continue to pay for this until she leaves, maybe she should apply,  once she ceases employment in Ireland, to have it changed to zero due to having no income?  I'm aware you're in the UK, but Newlife is worried so as not to do anything wrong and get into trouble, as they Judges do occasionally jail people here if they don't follow court orders.


----------



## Steve Thatcher

Bronte said:


> Steve, have you any idea what Newlife should do about the court ordered instalment order? Should she continue to pay for this until she leaves, maybe she should apply, once she ceases employment in Ireland, to have it changed to zero due to having no income? I'm aware you're in the UK, but Newlife is worried so as not to do anything wrong and get into trouble, as they Judges do occasionally jail people here if they don't follow court orders.


 
Hi everyone, my general advice when taking someone tghrough bankruptcy is to advise them to stop making creditor payments, especially if this is only going to be for a few months. 
The effect of not making the payments will be that creditors will put you on a call list and start sending some chasing letters. What they will not do for some time is take action to collect the debt. At least that is the Uk experience. From anocdotal evidence I am hearing from the Republic, some secured lenders are taking months and months to do anything, even write.

I would be hesitant about breaching a court order. How much is that oayment each month? Could it be easily handled if the mortgage and other debts weren't paid? Could the money saved on the mortgage and the debts then be squirreled away to pay for UK set up costs and the bankruptcy?

Am I ok to suggest newlife contact me direct?
Steve


----------



## newlife

Thanks bronte for your advice, 
And Steve will contact you today, thanks .


----------



## jamesy11

*Hi Steve*

Hello Steve,Ive been reading your posts Re Bankruptcy in Uk,I had a small business here in Ireland,not huge debts by any means,€25,000 to bank,€7,000 to a supplier,but im on dole here at moment,so def no chance of making payments,Im singe,no kids,no mortgage,no van,this was repossessed,€5000 owed on that,the bank loan was signed by meself my brother in law,because he had his own house,I have a brother in Uk,running his own small company,do you think its possible for me to just up/leave here,sign on dole there,find work,and go into bankruptcy
Regards Jamesy


----------



## Time

The court order would be unenforceable in the UK. Once the bankruptcy happens it is a moot point anyways.


----------



## Steve Thatcher

jamesy11 said:


> Hello Steve,Ive been reading your posts Re Bankruptcy in Uk,I had a small business here in Ireland,not huge debts by any means,€25,000 to bank,€7,000 to a supplier,but im on dole here at moment,so def no chance of making payments,Im singe,no kids,no mortgage,no van,this was repossessed,€5000 owed on that,the bank loan was signed by meself my brother in law,because he had his own house,I have a brother in Uk,running his own small company,do you think its possible for me to just up/leave here,sign on dole there,find work,and go into bankruptcy
> Regards Jamesy


 
Hi Jamesy, yes it would be. We have many people who go bankrupt here for less than the amount you owe. Think very carefully however as it is a big step.
If you came here could you get work with and live with your brother?

Steve


----------



## frostie

@jamesy Just bear in mind that if your brother in law signed off on the loan, he is jointly liable, even after you go bankrupt yourself.

www.frost.ie


----------



## S.N.Dipity

Hi Newlife,
I am a self-employed female and single parent in a very similar  situation to you, and am also considering the UK Bankruptcy route. 
I have spent the past 4-5 years working 60+ hrs a week for often less  than the minimum wage, saving every penny I could by selling my car,  cycling everywhere, not turning on the heating & buying all our  clothes in charity shops (MABS say I am a model client) in an attempt to  keep up with my Mortgage & other creditor payments. 
I have been in Court 50-60 times during this period (representing  myself), attempted to deal with my situation through the existing legal  system which has brought me no closer to any kind of resolution, and has  served only to line the pockets of the various Legal 'Professionals'  who in the absence of easy money from  Conveyancing have to rely on drawing out the legal process by requests  for irrelevant 'particulars' & repeated adjournments to maximise  their Fees. 
During this period I have had zero quality of life, and the stress of  these last few years are having a major detrimental impact on my  physical & mental well being, in addition to all the precious time I  have missed seeing my son grow up. 
I work in an area where too many of the hard-working, conscientious  & decent people I have worked with over the years have been driven  to a more drastic & final solution to their financial problems when the  system has failed them too. 
I never imagined that I would consider the Bankruptcy route, and I think  that like you I associate it with shame & failure, but from the  past 4-5 years of following the experiences of other honourable &  hard working individuals in similar situations through the media, I am  beginning to realise that I have come to a fork in the road where one  route will most likely lead to a life of partial or complete dependancy  on the State & the other may be the only way back to being a  productive & financially independant member of society.
I would be very interested in contacting you directly to discuss what I  know of the process with you & perhaps supporting each other through  the next few months.


----------



## 44brendan

Breach of a Court Instalment order could lead to commital proceedings being instigated. If you feel that your financial circumstances are such that you are unable to comply with the order then you can apply to the Court for a revised payment. In the interim it is best to maintain some level of payments on foot of this order & ensure that these payments are receipted. 
Please note that that any advice here is general only and you should seek full guidance from a solicitor (acknowledging that your track record on receipt of advice to date does not appear to be good!!).


----------



## southdublin

S.N.Dipity said:


> Hi Newlife,
> I am a self-employed female and single parent in a very similar  situation to you, and am also considering the UK Bankruptcy route.
> 
> I worked hard all through my life (or so i think!!). I am 39 with wife and 2 kids. I bought first house in 2005 for 305000 and after one year decided to move to a bigger city so put that house on sale and bought another for 500000 with a condition from bank that i'll sell my previous house asap. However, things took a nasty (or realistic) turn by late 2006 and house prices plummeted fast as we all know.
> Now, after so many years, i have 2 mortgages with 280000 due on first one and 490000 on second one ( i paid a bit on both). for last 6 months, I am unemployed and due to small kids, my wife doesn't work either. I couldn't afford hefty mortgage so moved out of my second house to rural Ireland in a cheaper house, down graded my car to old Micra, no holidays for last 2 years, no shopping from January sales, keeping my outgoings to the best minimum.
> Currently, first house is i negative equity of almost 75000 and second one of 250000...i've rented out both of them but still there is deficit of almost 1100/pm. and on top of it, there is 1700 management charge on my second house.
> By no means, i am able to pay that much deficit per month and have spoken to banks but there is no way the'll accept even interest only option as i had those houses on interest only for first 2 years..
> i just dont know what to do....Any help/suggestion/way out....please
> 
> Thanks..
> 
> 
> P.S. I know i am responsible for all this mess and as i am morally some what lower than all those builders/develops/NAMA dry cleaned people, so please advice as to get out of these mortgages rather than moral bull @#$t...sorry for being blunt but i am at breaking point especially when i read news of those a#$ holes living in English mansions while we are been told to be morally upright...my a@#e...


----------



## 44brendan

Given your financial position as presented the banks have little option but to agree to a reduced payment schedule. With no income (assumed other than SW payments) the Banks will have to deal with you in accordance with your financial circumstance. If you have'nt done so already, make an appointment with MABs. Pay the Banks what you can afford from the rental income on the properties in the interim & cancel any direct debits to your loan accounts, pending reaching a formal agreement. Ultimately both propertis will need to be sold.


----------



## southdublin

44brendan said:


> Given your financial position as presented the banks have little option but to agree to a reduced payment schedule. With no income (assumed other than SW payments) the Banks will have to deal with you in accordance with your financial circumstance. If you have'nt done so already, make an appointment with MABs. Pay the Banks what you can afford from the rental income on the properties in the interim & cancel any direct debits to your loan accounts, pending reaching a formal agreement. Ultimately both propertis will need to be sold.



Many thanks for your reply. I've spoken to both the banks and one of them even threatened me that by renting out my second house, i am in breach of contract as I've declared that as family home while buying it in 2006 (i lived in to it untill just 6 months ago), and they'll put that too in front of court...My feeling is that as banks probably know that its impossible for me to pay back the mortgage so they just want to speed up the process and get me declared bankrupt...will I end up in jail?? very very worried..


----------



## Peter54

No you wont end up in jail. I don't believe they will want to bankrupt you either. It's not in their interest to do so. Not being able to rent out your house is a standard line, also not being able to run a business from your home.


----------



## southdublin

Peter54 said:


> No you wont end up in jail. I don't believe they will want to bankrupt you either. It's not in their interest to do so. Not being able to rent out your house is a standard line, also not being able to run a business from your home.



Thanks for your reply. I've always been very honest and upfront with the banks and told them categorically that i am very efficient in my expenses and have no car loan, credit car loan, stores loan or any other kind of debt but off course having a young family of 2 kids is not cheap here and i told them that i m paying them every penny i get from the rent minus expenses on those 2 houses but everything seems to fall on dumb ears...I m seriously thinking of stopping all payments to those banks (both banks are major lenders in markets), spend thousands on my credit cards, get a hefty car loan (if I can!), wine and dine in style and once they go to the court, will run away to overseas !!!


----------



## 44brendan

This is an extraordinary approach from the Banks. The breach of contract issue is totally immaterial. I.e. They can certainly progress to Court to get posession of both properties, but realistically given the amount of negative equity apparent, you would be as well to co-operate in any re-posession proceedings over the properties. 
You cannot end up in jail for failing to pay debts. This issue could onkly arise in a Court Order for installments, which the Banks are unlikely to request given your financial circumstances.
If your only income is from SW, then these payments are required to maintain your family. Any income over and above that ( assumed rent only) can be used to service your borrowings. bankruptcy proceedings will not be instigated against you. However, you may well consider the UK option of a voluntary bankruptcy in order to avoid the residual debt hanging over you for up to 6 years (statute of limitations). Don't be intimidated by threats from the Banks. If you are co-operative to the extent of your own ability, they can expect no more and Court threats will not enable them to get "blood from a stone". Keep your chin up and best of luck!


----------



## Bronte

southdublin said:


> I m seriously thinking of stopping all payments to those banks (both banks are major lenders in markets), spend thousands on my credit cards, get a hefty car loan (if I can!), wine and dine in style and once they go to the court, will run away to overseas !!!


 

Don't do this southdublin. You are following the correct procedure in what you are doing, pay your household bills first and for your rental propeties continue to pay the bank the rent (less expenses), you have to learn to deal with the threatening letters from the banks. They are not going to bankrupt you or jail you. The letters are awful, but they cannot get blood from a stone. When you do go to court and show a judge you have acted honourable and fairly you will be heard. The banks will take the rental properties and the sooner the better for you, see this as a good thing so that you can start again. It's not a bad thing. Meantime try not to focus on the bank threats.  

In relation to the breach of contract, I'm guessing what the bank means is that loan was for a family home and that you should have notified them that you rented it out, well now they know and so what.  You had to do what you did.  I sincerely hope you are only corresponding with the bank in writing?


----------



## Bronte

S.N.Dipity said:


> .
> I have been in Court 50-60 times during this period (representing myself), .


 
That's an amazing amount of times to go to court, this is banks and creditors trying to get instalment orders?  

You could probably set up a new business advising people on what to do in court.  

You didn't ask for any advice but maybe you and Newlife could take off to the UK together.


----------



## Time

> I have been in Court 50-60 times during this period (representing myself), attempted to deal with my situation through the existing legal system which has brought me no closer to any kind of resolution, and has served only to line the pockets of the various Legal 'Professionals' who in the absence of easy money from Conveyancing have to rely on drawing out the legal process by requests for irrelevant 'particulars' & repeated adjournments to maximise their Fees.


Bloody hell! Talk about abuse of process. Most judges would not tolerate such carry on.


----------

