BR adverts to cease!

[Adam Davies]

Hi
I think that there are many reasons to consider,not only financial but your family and relationships.
We are all agreed on this forum that we do not promote debt avoidance.
Regards

[ianmillington]

I think the banks have started to recognise that by taking a sideswipe at IPs they were in danger of killing the goose. Hence the protocol.

When the Enterprise Act came in, many said that signalled the death of the IVA. We shall have to wait and see what changes this one brings.

Ian

[Skippy]

I can see both sides of this having been in an IVA and then going BR. I can afford to make repayments (I am paying into an IPA), but not enough to have been able to support myself for 5 years. I had the stupid "no variations in the first 24 months" modification which meant that I had 2 options - struggle on with Dave supporting me or go BR. Dave supporting me wasn't an option - he is self employed and his salary varies a lot from month to month.

I asked my IP if I could request a variation meeting and he said no (point blank wouldn't consider it) and actually advised me to go BR. I would have been happy to extend the IVA by a year to meet the minimum dividend, but there was no way round it.

I know some people (and I don't mean anyone on this forum) think of BR as a way of not repaying their debts and that is wrong. From my point of view going BR was the last thing I wanted. I would do away with early discharge (and not because I didn't get one[:D]!) so everyone is automatically BR for one year - it's not long in the great scheme of things. I would also standardise the allowances - I don't mean everyone can have a set amount for food etc (life's not that simple!), but I would standardise the things you can claim for, food, clothing, hairdressing etc.

[North East Derbyshire CAB]

Hi all,

Just read the article in the Telegraph.

We have seen a fair number of clients over the years who have not wanted to go down the bankruptcy route due to the fear of their friends, neighbours, workmates and family reading about it in the local paper.

The implications of this could be enormous, however it is early days and as has happened before, things don't always turn out how you would first expect. Our first impression though is that we may need to stock up on forms 6.27 - 6.28 and look for funding for more staff. We suspect that there may also be a well known goverment department that could be thinking the same.

We would imagine that there will be a few interested and anxious eyes and ears watching and listening to Wednesdays budget.

Just wondering, did any anyone see this coming? as its the first we have heard of it.

[ianmillington]

It was news to me. It is, as you have correctly identified, early days yet.

Will the DTI be able to cope, I wonder?

[sjw]

for me i would rather struggle in an iva because of the notice in the paper because its not just myself i would worry about i know my mother would be horrified if nieghbours and reliatives knew as well an parents of my chidren friends, so i admit if i knew that it would not be in the paper i would consider br as i know i am really going to struggle to survive in an iva not just to avoid paying debt.

[Martha07]

Going off the mark a bit. How are employers and landlords informed when you go bankrupt?

[North East Derbyshire CAB]

Ian,

Do you sometimes get the feeling like some of us at NED-CAB, that sometimes people make decisions and announcements without really understanding the possible full implications.

[Adam Davies]

Hi Martha
Employers are not directly informed,however you will be given a zero tax code during the first tax year[or part of] that you are bankrupt.
I believe that some ORs do not advise landlords as long as you can show that you are upto date with rent,although one of the more knowledgable experts will confirm this.
Regards

[ianmillington]

I'm afraid I'm a lot more cynical than that. I worry that the same old mantra is being used to assist in collecting what is effectively a hidden tax. The Government knows that probably 80% of people who elect to present their own petition will probably never dream of starting their own business. By making Bankruptcy less and less scary, they simply swell the coffers mainly from consumer debtors and creditors probably lose out.

As we all know, both Bankruptcy and IVAs impact upon credit ratings. Touching on Melanie's reference to "debt avoidance", and Bankruptcy now really being seen as the line of least resistance, does anyone see the potential for a two-tier impact on credit ratings in future?

Ian

[Adam Davies]

Hi
The government needs to make an IVA an attractive solution to the debtor compared to bankruptcy and this is an area that maybe the creditors can help by acknowledging the debtors that try to repay as much as possible via an IVA,and this could be by making the credit rating less harmed than under bankruptcy,as per Ians thoughts.
If we do see the advert in the local paper disappear then the choice,if you have no property or equity,is a five year 100% disposible income paying IVA or a three year 50-70% disposible income paying IPA in bankruptcy.I know that some people will prefer to repay creditors as much as possible but I think reality is that many people will opt for bankruptc because it will effectively be kept private and will be far less onerous
Regards

[ray_a]

Just wondering whether the Government want to cover up for allowing easy debt and do not want the embbarrasement that their pledge of no "boom and bust@ policy actually became a major collapse of 3m people becoming insolvent. Not something one would want to advertise in a future general election!

[ladyc]

I think it is about time people didn't have to have the humiliation of their private business advertised in the local paper.
Where have the human rights brigade been with this issue?
Unlike what some have said on this post, I am quite sure that most people do not see bankrupcy as debt avoidance but more a last resort.
Anyone that has had an exemplary credit history, then finds themselves in the terrible situation of n ot being able to pay feels so alone, ashamed and confused. They cetainly don't need to be called debt avoiders, nor do they need public humiliation to bring in extra business for the so called caring IVA companies that are hardly doing this for nothing. Yet I am finding that these very people are shouting the loudest here in case they loose business.
People are killing themselves with the worry of debt. Maybe that is what you'd call debt avoidance too.
Very few people would take any of the steps needed lightly. Almost all would much rather be able to pay in full and on time. Unfortunately in life bad things happen. From my own experience, I just want it all to go away and if bankrupcy was an option to me then I would seriously consider it and why not?

[kitty]

Ian,
Just thinking about the quote "they simply swell the coffers mainly from consumer debtors and creditors probably lose out."
If it was the creditors that lost out in the long run, then maybe they would be forced to address the issue of making it so easy to access "easy credit", which is one of the reasons that some people get into debt in the first place.
Would this necessarily be a bad thing??
Kitty

[sjw]

couldnt have said it better ladyc