There are a number of questions that people ask when seeking advice on going bankrupt in England and Wales. For people seeking help with debt, going bankrupt is a big step and here you will find the most the advice most commonly given.
How Long Will I Be Bankrupt?
The usual length of a bankruptcy in England and Wales is just a year. The vast majority of people will be automatically be discharged after one year. Those who have been culpable in their bankruptcy, for instance through gambling, can expect to see their discharge suspended for between three and fifteen years.
Can I Keep My Car?
The Official Receiver will allow you to keep a motor vehicle if it is required for work, with a value of up to £2,000. The vast majority of those going bankrupt will have a car valued at less than this. Others may have a car on finance. The Official Receiver will often not interfere in a situation where the car is on finance and the finance company is happy for payments to be kept up. If a vehicle is owned which is valued at more than £2,000 the OR will take a view as to whether he can realise its value and of so will expect it to be delivered up to him and in return he will provide £2,000 in cash.
Can I Keep My House?
This is usually the main question that people ask. For some of course, the chance to allow the house to be re-possessed and any negative equity written off in the bankruptcy is a good option. In times of falling house prices such as we are experiencing at present, negative equity can present itself very quickly. If bankruptcy has been brought on by unemployment, it can be impossible to keep up repayments on the mortgage in any event.
The share of the house belonging to the bankrupt will vest in the OR on the making of the bankruptcy order. If there is no equity in the property, the OR will be happy to transfer it back to the bankrupt or another named person for £1 plus his costs. If there is a little equity, the house can be transferred back for the payment of an agreed figure.
It should be noted that whilst the bankruptcy will probably end after one year, the OR will have up to three years to deal with the property so it is best to get any issues with the property dealt with immediately.
Will I have to Pay Income to the OR
If you have disposable income this will need to be paid to the OR for a period of three years. If you engage an expert he will be able to show you how to best deal with your income and expenditure so as to produce the best disposable income situation.
If in doubt about how you may be affected, make sure that you take professional debt advice.
Monday 24 August 2009
Car Sales in the Recession
A car is the second largest purchase that many families make. Most people cannot afford to make a payment for a new or second hand car out of cash and credit will be required. So what do you do then if your line of credit has dried up.
This is a problem being faced by very many car dealers at the moment. Industry figures reveal that new car sales in the UK have fallen by 15.7% in June this year compared to June last. In May fall was 25% year on year.
In the month of June some 176,000 units were sold across the UK. Many of these will have been sold to industry, with the private buyer sector really struggling to purchase due to a lack of credit around for them to utilise.
The Government scrappage scheme which came into effect on 18th May has had some effect with nearly 30,000 vehicles over 10 years old being cashed info £2,000 against the price of a new car. At this rate the scheme which was due to last a year will have exhausted its funds by October. The Government has said it will not be extended.
The problem may then re-occur that the market starts to contract yet again.
I am hearing problems from second hand car dealerships that they simply can’t move older cars. If you had a chance to purchase a second hand car for £10,000, or a new car for the same amount, with a five year warranty, what would you do?
This means that there are a number of dealers in the market who have stock that they have tied up, but which they can’t liquidate.
These businesses have rents to pay on the units that they keep. They have wages to pay, and possibly finance charges for borrowings they have which they may have used to purchase stock.
If you run a business such as this, you may be needing to take stock of your current situation. If you are struggling it may be possible to take steps to, extricate yourself from debt, and re-start in a debt free company.
A professional advisor, will be able to offer advice on something called a pre-pack administration, or liquidation. This will enable the debt to be left behind and the stock and lease and employees to be transferred to a new company.
This is a problem being faced by very many car dealers at the moment. Industry figures reveal that new car sales in the UK have fallen by 15.7% in June this year compared to June last. In May fall was 25% year on year.
In the month of June some 176,000 units were sold across the UK. Many of these will have been sold to industry, with the private buyer sector really struggling to purchase due to a lack of credit around for them to utilise.
The Government scrappage scheme which came into effect on 18th May has had some effect with nearly 30,000 vehicles over 10 years old being cashed info £2,000 against the price of a new car. At this rate the scheme which was due to last a year will have exhausted its funds by October. The Government has said it will not be extended.
The problem may then re-occur that the market starts to contract yet again.
I am hearing problems from second hand car dealerships that they simply can’t move older cars. If you had a chance to purchase a second hand car for £10,000, or a new car for the same amount, with a five year warranty, what would you do?
This means that there are a number of dealers in the market who have stock that they have tied up, but which they can’t liquidate.
These businesses have rents to pay on the units that they keep. They have wages to pay, and possibly finance charges for borrowings they have which they may have used to purchase stock.
If you run a business such as this, you may be needing to take stock of your current situation. If you are struggling it may be possible to take steps to, extricate yourself from debt, and re-start in a debt free company.
A professional advisor, will be able to offer advice on something called a pre-pack administration, or liquidation. This will enable the debt to be left behind and the stock and lease and employees to be transferred to a new company.
My Company Is Bust
This is a phrase that we hear everyday. It is uttered by businesses large and small. Every sector of the economy is now encountering problems as access to funding has dried up and the consumer spending boom ratchets back in. People who are afraid of their own debt levels, and employment prospects, decide to spend less on impulse purchases and instead consolidate their finances, by paying down debt or saving.
The effect of this is that sales on the high street suffer. This exacerbates the problem, by meaning that these companies suffer a down turn in profits which results in them having to shed jobs to maintain profitability.
Everyday in the news another High Street chain closes or files for administration. Each one of these takes its supplies from British companies who either manufacture themselves or import from abroad.
From textiles to estate agencies, from mobility scooters to dyers, everybody is having to tighten their belts.
For many there is nothing left to tighten. For others the time they have to react is just too short.
However for everybody there may be a solution. As with all things insolvent, timely intervention is the key. The earlier a solution is explored the better chance it has of being successful.
There are a range of solutions which include non insolvency turnaround, through dividend returning CVA’s and Administrations to pre-pack sale administrations and liquidation to the straight forward liquidated closure.
The fact that the limited company shell may have to close does not mean that a business dies. If you have a company that is bust, you need to take professional advice and take steps to minimise losses to your creditors. Failure to do so may cause problems for you in due course if you cause additional loses. This may result on personal liability for the directors as a result of wrongful trading.
The effect of this is that sales on the high street suffer. This exacerbates the problem, by meaning that these companies suffer a down turn in profits which results in them having to shed jobs to maintain profitability.
Everyday in the news another High Street chain closes or files for administration. Each one of these takes its supplies from British companies who either manufacture themselves or import from abroad.
From textiles to estate agencies, from mobility scooters to dyers, everybody is having to tighten their belts.
For many there is nothing left to tighten. For others the time they have to react is just too short.
However for everybody there may be a solution. As with all things insolvent, timely intervention is the key. The earlier a solution is explored the better chance it has of being successful.
There are a range of solutions which include non insolvency turnaround, through dividend returning CVA’s and Administrations to pre-pack sale administrations and liquidation to the straight forward liquidated closure.
The fact that the limited company shell may have to close does not mean that a business dies. If you have a company that is bust, you need to take professional advice and take steps to minimise losses to your creditors. Failure to do so may cause problems for you in due course if you cause additional loses. This may result on personal liability for the directors as a result of wrongful trading.
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