Living in London with Irish debt and wanting to go bankrupt

If you are watching this video on youtube or reading my blog, the chances are that you are Irish living in London with a pile of Irish debt, or you are thinking about moving to our capital for work purposes and wondering if you can go bankrupt here at the same time.

Many thousands of Irish come to London live and work each year. A small percentage of them also use the opportunity to try to deal with property losses they have sustained since the collapse in the Irish economy over the last four years.

Whilst it is easy to live and work in London, and hence establish your centre of main interest there, it is not quite so easy to go bankrupt.

A number of high profile Irish Nationals have tried to go bankrupt in the UK using the Royal Courts and some have found out how time consuming it can be.

In London an application for bankruptcy is begun in the Rolls Building on Fetter Lane if you owe in excess of £100,000. Ordinarily, if your debt is all UK based, the bankruptcy registrars would review your petition and make an order without even having to see the petitioner, all on the same day.

Where the debt is overseas, the Judge will not make a bankruptcy order on the same day as the petition is filed. Without exception now they will instead make an order that the petitioner file a witness statement in which they set out all the evidence upon which they wish to rely proving that their centre of main interest is in the UK.

In essence this means all evidence of residency such as rent agreements, utility bills, wage slips and bank statements showing wages going in expenditure coming out. The court will also want to know what ties there still are with Ireland. The cleaner the break the better chances of the Judge granting the order. This hearing only takes 15 minutes, but it can be quite detailed and will in any event be listed at least two months after you first filed your papers. The court will also require you to tell your creditors of the hearing, ensuring that they have a chance to attend if they so wish. I have done a number of these hearings and never once has a creditor attended.

Far better than to petition in London, would be to live on the periphery of the capital and commute in to work. Places like Croydon and Kingston Upon Thames and Luton will deal with the petition on the day it is issued, without the need to file a witness statement in support.

The practices of dealing with Irish bankruptcy petitions is changing and will continue to change. You cannot assume that because you thought you knew how the courts were treating Irish Bankruptcy petitions, the same still holds true.

Call me on 07837 60820 for the very latest news on how courts in your areas are treating Irish Bankruptcy.   

Latest developments in Irish bankruptcy in the UK

As probably the leading authority on the Irish going bankrupt in the UK I am in the prime position to be able to advise those seeking to learn how to go bankrupt in the UK, of the latest developments

Over the last four years I suspect that I have taken more Irish people through bankruptcy here in the UK than anyone else.

Each week I am at a different court somewhere in England and Wales helping someone wipe off their debt. Due to the range of courts that I get to visit and consequently the different number of judges I appear before, I get a unique perspective on how these courts treat a bankruptcy application comprising solely Irish debt

12 months ago the court of choice for the Irish looking to go bankrupt would have been Liverpool. It was close to home, there is a large Irish population and the courts were used to seeing Irish people making applications.

A year on and the picture is slightly different. In recent times at least 50% of individuals who have presented petitions here with me have not had their bankruptcy order made on the initial application. These cases have been transferred to Manchester.

The reason given is so that a witness statement can be filed where evidence supporting the COMI is attached. Ie the lease, wages slips bank statements.

This statement and the filed statement of affairs is then sent to creditors along with notice of the bankruptcy hearing.

Of all those cases which have been transferred, to Manchester by this route, all my clients have had their bankruptcy orders granted.

It also appears now that if you file your bankruptcy application in Manchester, the same process will apply.

In reality all that is now happening here is what has been happening in London for two years. In London nobody from the EU ever has their bankruptcy granted on paper. They are all asked to appear at a hearing with evidence that their comi is in the UK having been filed in a witness statement.

There are courts around the UK where these practices do not occur.

In order to get this up to date information, I am encouraging those seeking assistance to call me and book a paid consultation, where for £250, I will provide complete advice on how to go bankrupt in the UK, what you need to do, whether it is right for you and perhaps where it might be best to relocate to.

Email me or call on 07837608220

Steve on RTE talking about the Irish Insolvency legislation

I was on RTE breakfast radio, giving my views on the Irish Insolvency Legislation and where I saw it affecting the movement of people to the UK.

This followed a piece in the Sunday Business Post the previous day 28th January 2013 about the rise in the numbers of people from Ireland going to the UK for bankruptcy

http://www.rte.ie/news/player/2013/0204/20149804-extraordinary-rise-in-number-of-irish-people-seeking-uk-bankruptcy/

New Year and a new start - going bankrupt in the UK

A New Year has dawned and for many it will herald a chance for a new start. In Ireland I know that many families will be facing up to another year of debt and depreciation and for lots they will be seeking to move across to the UK to set up a new life.

For those who come to the UK and establish themselves, they may in time turn their thoughts to getting rid of their debts and declare bankruptcy. Indeed I know of many who have decided to move to England simply for the purpose of going bankrupt, which is what they are entitled to do.

If you have reached the New Year and decided that a new start is for you then you need to be absolutely certain that the steps you take will enable you to declare bankruptcy in due course. You will have to establish the UK as your centre of interest. That means that you will if possible be expected to get a job and support yourself as benefits will not be available.

As well as getting a job and a residence you should also establish a bank account. That account will need to be used on a regular basis as the Official Receiver will expect to see transactions taking place as evidence of constant living in the UK.

When you have been in the UK for up to six months you will be able if you wish to apply to the local county court that has jurisdiction for bankruptcy. Each county court has a different way of approaching bankruptcy. It is best to speak to the court and ask them their procedure. They may send you a pack for bankruptcy, which will include a petition and a statement of affairs which you will need to complete.

When this is done you will need to attend court with three copies of each document. You will also need a fee of £700 which is part court fee and part official receiver’s deposit. The court staff will process the papers and then you will be taken to see the Judge. If the Judge is satisfied that you are entitled to bankruptcy, and he will check that you have established your centre of main interest here, he will grant the bankruptcy order.

Once the order is made the affairs will be handled by the Official Receiver. His job will be to contact the creditors and realise any assets for the benefit of creditors. The Official Receiver will contact you within 24 hours to establish contact. In as little as three weeks he will conduct an interview with you and discuss the statement of affairs.

If no issues arise then the bankruptcy will automatically come to an end in just 12 months.

   

What to expect when you go to court for a bankruptcy hearing

If you are one of the millions who have been struggling ith debt over the last three years then you may have considered a number of debt solutions.

Perhaps you have tried something as simple as a debt management plan, either set up yourself or through a debt management company. For others, it may have been an IVA put in place for you by one of the numerous providers who you can see advertising on TV and in the papers and across the web. In have helped out many people who have tried an IVA but found that they cannot meet the monthly contributions.

If you have tried these solutions and found they didn’t work, or if you have realised that your debt problems need a quick but effective solution, then bankruptcy may be the appropriate solution for you.

The bankruptcy experience can be daunting if you have never been involved in producing official paperwork, or been at the county court before.

You can get help with the bankruptcy process from organisations such as the CAB or ourselves. You can get your bankruptcy pack from me, the CAB or the court.

The court clerks are very knowledgeable and do their best to put you at ease.

When you begin the bankruptcy process you need to have all your information to hand. This would be details of your income and expenditure and your assets and liabilities. This will make the process of completing your statement of affairs. Which is 28 pages long, an easier process.

If you can complete your paperwork yourself, you need to take the statement  of affairs and the petition in triplicate to your court. You will also need a fee of £700 (unless you qualify for a remission). That fee needs to be in cash.

The court clerk will process your papers and check, (a) that you at the correct court, (b) your paperwork is in order and (c) that you have taken appropriate advice. If the clerk is satisfied that all is in order, then they will process your papers and give you a court number. They will take your payment, and advise you where to wait to see the District Judge.

That part of the process should take no more than 30 minutes.

It may be some time before you can get to see the Judge. It mainly depends on when he can fit you in between all his other scheduled work. In some courts the process is structured to enable the Judge to see you before he starts any of the rest of his days work.

The Judge will be concerned primarily in ascertaining that you have taken proper advice and you appreciate what the effects of bankruptcy are. He will check to see that your debts levels are appropriate for bankruptcy. He will make an order with a specific time quoted. This will mean that at that moment 12 months hence you will be automatically discharged.

You will be free to leave they court after the order has been made.

What expenditure can be put down in a statement of affairs

I am often asked what expenditure can be included in a statements of affairs. Quite rightly someone going bankrupt wants to be able to include in their list of outgoings everything that they spend each month. Actually this is also very important because the Official Receiver is entitled to take any money that is deemed as surplus to an individual’s requirement for the benefit of creditors.

The Official Receiver has the power to agree an income payments agreement or ask the court to make an income payments order.

The Insolvency Services guidance to its own staff in its technical manual states that  when making an assessment of the outgoings claimed as essential by the bankrupt, the official receiver should always consider each case on its own merits. An assessment should be made as to whether the outgoings are realistic, relevant and appropriate to the bankrupt’s circumstances and whether outgoings included are sufficient to provide for the reasonable domestic needs of the bankrupt and his/her family.

It goes on to say that any expenditure included in the bankrupt’s statement which appears to be non-essential or included simply to prevent any surplus becoming available should be closely questioned,  e.g. weekly launderette costs are included but the bankrupt has use of a washing machine at home.  Particular care should be taken where the bankrupt has been assisted in preparing his/her statement by a commercial organisation, as a set of pro-forma outgoings may have been included which are not expenses actually incurred by the bankrupt on a day-to-day basis.

This is why when I help a client complete their statement of affairs, I dig down into what is really spent in the family home each week. The completion of this form is very important and it could be the difference between making no payments or thousands of pounds in contribution over 36 months.

As the bankrupt you are entitled to argue that the continued payment of certain expenditure items is required, above that considered reasonable by the official receiver to meet the reasonable domestic needs of you and your family.  If you persist in your argument, the official receiver should ask for further information detailing the extenuating circumstances justifying why you consider this an essential expenditure.  The Official receiver then has access to a manual and case law which helps him decide of your expenditure is reasonable for your needs and those of your family.
I have often found that with a good argument and a no back down attitude it is often possible to get the Official Receiver to back down. Getting advice on the expenditure that can be claimed on a statement of affairs can be the best advice you take in relation to going bankrupt.  

Here is a post I made a year ago on 23rd Jan - what has changed

As I prepare to fly to Dublin yet again to talk to people who want to go bankrupt in the UK, I was prompted to look back and see what I was writing about a year ago. Here is what I wrote on 23rd January 2012

I have just returned from a trip to Dublin to meet with my partners irishbankruptcyuk.ie . It was a sobering experience as they introduced me to clients they had signed up for the bankruptcy process, solicitors who were trying to deal with ever increasing hard handed approaches from lenders and just ordinary people who are trying desperately to work out what they should do.I had a round of meetings with people who were in differing degrees of financial meltdown, from a couple who had negative equity in excess of €500,000 on their matrimonial home and an investment. With the husband on short time and the wife not working, making mortgage payments is proving impossible. They do not want to carry the burden of this debt around with them for the rest of their lives. Their decision is to take their family and move to Northern Ireland and try to start again. In a few months time once they are settled they will look to go bankrupt and close a chapter on their property venture.
I met another client who had done very well in the property construction sector. He had made his money but like many others was encouraged by his bankers to take on more and more debt to buy more land to develop. When the credit crunch hit after the collapse of Lehman Brothers, he fund he couldn’t sell the properties he had constructed. He couldn’t make repayments on his loans and he defaulted. He has sat down with his bank, but they have simply said that he has to make payments. He owes many millions. How is he supposed to do that? There is no magic pot of money he can go to. He is leaving Ireland and coming to live in England. He is getting out of construction and seeking a new job. In due course he will take measures to go bankrupt. He doesn’t like to do it but how else is he going to get rid of millions of Euro of debt.
I met a solicitor who now advises her clients on how they can go bankrupt in the UK, whilst at the same time trying to do deals with banks to write of debt that will never be repaid. She says that there may be loopholes in some agreements, if this is accepted by the banks in individual cases there may be a chance to get the loans wiped. If not, her clients will have been living in the UK long enough to go bankrupt if they so wish.
With bankruptcy in Ireland not being a realistic option, many are looking to move to Northern Ireland and mainland England, establish their lives here and then avail themselves of the friendlier UK bankruptcy regime. With over 1000 people a week in the UK going bankrupt and that many again also doing an IVA or a debt relief order, compared to just 29 people in a whole of a year going bankrupt in Ireland, you can see where the solution lies.

So nothing has changed. Despite the changes made to Irish Bankruptcy laws, which will be implemented shortly, there will still be hundreds if not thousands of people who will seek to move across here to England to go bankrupt rather than go bankrupt in Ireland for three years and risk the probability of a five year income payments order at the end of that. Who wants to potentially make payments to creditors for up to eight years. No one if what I am hearing from my Irish clients is anything to go by.