should i go bankrupt?

Question

im about 8 thousand pouds in debt and im struggling to pay it back.

i was in a serious accident and was off for work for 7 months and since then my finances have gone completely wrong.

i hate opening letters and dont answer the phone incase its about money i owe.

have you got any advice on going bankrupt and what i have to do? is this a good idea and how would it affect my life?

please help me, im so worried xx

Answer 1

Poor you, Having money worries sucks!But there are lots of options available.
You need to start being pro-active now. Your money worries will just get worse the longer you ignore them

Get yourself down to the CAB straight away. They can go over all your options with you.
Debt problems are the highest percentage of advice sought from the CAB.
They have produced a specific information pack with all the forms you need and will give this to you when you go. You will need to take all you info (re. how much you owe and to who and when so on) so start opening that post!

You havent said who you owe. I'm assuming its a credit card / loan (and not a loan shark!) You will need to speak to them regarding this, they will be able to help arrange a payment plan to pay off the interest until you are back on your feet.(you wont be the first person who has phoned them regarding this so dont panic! They just want their money and its in their best interests to help you pay it back)

£8.000 isn't really a huge amount so maybe dont go down the bankruptcy route just yet. Although it is an option an it certainly doesn't have the implications it used to. You'll prob only be bankrupt for 9 months to a year (not 7 years like the old days!) BUT it will have implications on your future credit rating so you need to think long and hard before you do that.

Hope it all works out for you!
Check out the link below for the CAB guide on bankruptcy.
x

Answer 2

Act now, and stop feeling sorry for yourself. In the scheme of things £8,000 is a drop in the ocean.

Get advice from the Citizen's Advice Bureau for help drawing up a recovery plan, and for God's sake talk to your bank and others you owe money to. Explain what has happened to you, and they should give you a sympathetic ear. This will greatly ease the pressure you are under.

If you leave it, and get in deeper trouble financially you will be regarded as irresponsible and will get less help.

Going bankrupt is the very last thing you should consider, and you are nowhere near that stage yet. If you do, it takes ages, costs even more money, permanently affects your credit rating, and basically ruins your future.

Good luck, mate. It will be OK.

Answer 3

If you declare bankruptcy it will affect your ability to get things like car loans or mortgages in the future for a very long time.

If you're back at work now and earning a regular wage, then you CAN pay back £8000 over a few years.

The best thing to do is get a minimum interest term loan from a bank and pay every one off now. That way, you only have one repayment to worry about. For £8000 you would probably need to spread it out over 3-5 years depending on your wages. Don't get a repayment schedule that's too harsh - take into account things like Christmas and holidays etc that need to be budgeted for too.
Avoid getting a consolidation loan if you can - interest rates tend to be much higher than normal loans.

Have your waged paid directly into your bank account, and set up standing orders and direct debits for all regular outgoings. It may cost a bit extra, but at least those bills are paid regularly.

Budget your wages so you're able to manage the monthly repayment. If you're living beyond your means, you're going to find yourself in much hotter water in a year's time. Remember living within your means is about how much your wages can pay for month to month - not what you think is a reasonable lifestyle for you.

Cut up any credit cards or debit cards that allow you to overdraw.
Ideally get a second job at weekends to provide a cash boost for food and day to day travel etc. If that's not practical, then allot yourself a weekly cash allowance and make yourself physically go to the bank to withdraw it. That way, you'll avoid impulse spending and temptation.

If you can save a little every month and clear the loan early, that ill stand to you and improve your credit rating.

It'll be difficult but by no means impossible. Stick with it, and in a couple of years you'll be debt free!

Good luck.

Answer 4

I dont know how old you are, but if you are young with the rest of your life ahead of you it would not be the best of ideas. £8000 is not a huge amount of debt although it seems like a mountain, believe me it could be a lot bigger. What I suggest is go see the citizens advice regarding your position they will contact the debtors and prioritise your debts, sometimes non priority debts can actually be wrote off. It is a terrible feeling when you are avoiding the door and the telephone, dreading the mailbox. Honestly this can be sorted and it will then keep the vultures at bay. Do go see them and get this sorted.

Answer 5

I know things are rough right now,but before You go that route please check into debt consolidation,they can lower interest rates,minumize payments and help get You back on Your feet.We all stumble sometimes and need help recovering.There are tons of places out there doing this,go online and put in bill consolidation or debt ... You know-You can also check locally. If You do end up going the latter please research all of Your options,which chapter to file under and so forth,You will need to hire an attorney.Your attorney is paid to be of service to You so write down all questions You have and be sure to go over them with him/her.Don't feel funny about asking anything,there are no dumb questions,this is Your financial future at stake.
Please don't worry, for nothing is accomplished by it. Taking action one way or another will empower You and help make You feel stronger and more agile.

Good Luck and Best Wishes,
Sue

Answer 6

Do not go bankrupt for £8,000
It isnt worth looking at Bankruptcy at that amount.
I had a similar problem a while ago and the people who helped me the most were Citizens advice. They are great and they dont let your creditors get away with anything. They are also free which in your situation is what is most needed.
Also credit companys sit up when you get CAB involved as they know that they cannot use heavy handed tactics.

Ring them, things will get better. In the meantime if you need to chat to someone who has gone through it, just mail me. We can pass emails back and forward and lets hope that things get better for you.

Answer 7

I cannot give you the advice you need but I do know what your going through , my son had a bad car accident , he had 1 hr to live & facial deformity he was off work for 18 months , I did not know that he was getting his mate to get him cocaine so he would forget his problems , he got into extreme debt , will not open his post or answer his mobile , he goes out every day to avoid knocks on the door?
He cannot pay it back as he lost 2 jobs since his accident through forgetfulness, he is out of work now , on jobseekers allowance £59 pw
so I understand

Answer 8

Going bankrupt is not the easy answer lots of people think...it will affect so many things in the future...£8,000 really isn't an un-payable amount of debt what you need is debt management..look on the net there really is plenty help on offer...you local citizens advise bureau will be very helpful even down to getting you a solicitor free for 1/2 hour...but please stop beating yourself up over this you can sort it you are going to make yourself ill and that's no good to anyone....good luck for the future.

Answer 9

You need proper independent financial advice.

If you are getting back to work, 8,000 isnt really that much, you may have to take out a long term, minimal interest rate loan to address it. But always ask how much youll pay in total and make sure the early payment othions arent too much.
Plenty of advice on the website below.

As regards bankrupcy, sounds nice to walk away from debt but I'm not sure its that easy. I dont know but it would probably ruin you chances of loans and mortgages in future.

Answer 10

Do not go bankrupt because you will lose all your freedoms. I work from home in shorts and T-shirts and sometimes topless. I have all the freedom I need. The only thing that tied me down is 'how much income I want or need' I create new page for my websites everyday. The more websites I have will determine how much income I can get. Anyone who can type and can create websites or blogs can make money. Blogger.com lets you create blogs for free and allows you to make money too. If you can create websites or blogs and can type, you can make online money online easily. You may make money by publishing Google Adsense on your websites. If you have a website or a web-blog, you could make money by publishing advertisements on your site (by google). If someone clicks on those ads, you will earn money. If you don't have a website, you may start creating web-blogs like blogger.com (mostly free) with advertisements (google ads) on it. Some free websites don't allow you to publish google adsense because they are doing it themself. I had received too many yahoo violation notices, so, I'll better not post my own url here. i come by this new blog which I think is good. Take a look if you are free eg: http://lost-newbie.blogspot.com/ I found her on blogger.com. I recommend this blog because I think she needs money badly