Friday, 27 November 2009

The Official Receiver calls

We might lose the car. That is the upshot from my phone conversion with the representative from the Official Receivers Office yesterday. The call lasted 58 minutes (his initial estimate was that it would be twenty!). He asked about the chain of events that lead to the bankruptcy, about my credit card usage, and about my assets (a £3K car and a house with negative equity). All not exactly easy questions, but it was quite simple to just tell the truth. On the credit card usage I couldn't even answer to within a year as to when I even acquired them!

With the car, it seems quite simple. They work out what they might sell it at auction for, and if this is less than around £2500 then it looks like I can keep it (providing I pay the difference from £2000 upwards - yet again, I can 'buy' their interest - who would have thought that bankruptcy brought costs like this - not something I realised beforehand). If its value comes back above £2500 then it will simply be sold at auction and I'll be given £2000 to buy another car.

Yesterday I also spent the best part of two hours transferring the majority of my direct debits to my new Cashminder account. Time consuming, but relatively hassle free...

Thursday, 26 November 2009

Waiting for the call

Sat at home waiting for the call from the Official Receiver. Bricking it. All logic has gone out the window, even though I know they will be professional. Want to just get this over with.

Wednesday, 25 November 2009

The Bank of Scotland sends a nice letter

Got home tonight to a nice little letter from the Bank of Scotland...

"Important notice, our representative will be calling your home on : 28th November 2009 - Please telephone 0845 300 05XX IF THIS IS NOT CONVENIENT"

That's a whole seven days after advising them of my bankruptcy. I intend to call them tomorrow to tell them what I think of them.

Dodged that bullet

Latest bullet dodged, so I can share it with you now.

Last month, when working out the best day for me to go bankrupt I hit upon a problem. The payroll department in my company requires over two weeks notice of a new bank account to put my pay into, and so I couldn't get this to square with other factors like when my direct debits come out of my account. Basically, I couldn't sort out a date to go bankrupt and still have time to get a new bank account and get my pay paid into it. Problem. So my wife and I came up with my pay going into her bank account for a month, with that giving me enough time to set something more permanent up. This sounded like a good idea at the time and I contacted my works payroll department with her bank details.

All looked fine, but we soon hit problems. My wife will go bankrupt soon too, so she hasn't been paying her Barclaycard. The trouble was that her bank account is with Barclays, and we were shocked to find that after a couple of months of missed payments to Barclaycard they effectively dug into my wife's Barclays account to pay part of her Barclaycard debt. They also sent a nice letter (after they had taken the money) ... 'We are writing to advise you that we have carried out our legal right to set off part of the outstanding arrears owing on your Barclaycard account against the credit balance in your Barclays account...'. I bet not many of you knew they could do that! So suddenly we had visions that as soon as my pay went into the account that they would happily help themselves to it to pay a chunk of the Barclaycard debt.

My pay went in at midnight last night, so this morning my wife sat down at the computer to transfer the money into my new Co-operative account - and guess what? 'Transfer delayed 24 hours to help protect against fraud' .... Oh my God, we can't get the money out. Mass panic for a few seconds before a new plan came to us - my wife was to go to the bank first thing and withdraw it personally, and pray that the bank teller didn't try to be clever.

My wife called me at work at around 9:45, 'I've got the money.'

Big sigh of relief from me.

Visiting the Insolvency Service

Just a quick post to say that I called in at Melbourne House in Newcastle about 20 minutes ago to hand in my paperwork to the Insolvency Service. For future reference if any of you ever have to go there - the entrance is through the car park rather than on the road.

On another note I'm pretty stressed right now - yet another (potentially major) money problem. I'll let you know soon how I've got on - if things go wrong then I'm screwed!

Tuesday, 24 November 2009

Preparing to talk to the Official Receiver

The Official Receiver calls on Thursday and I'm spending some time going through my Statement of Affairs. There isn't a lot to it really, my only assets are a house in negative equity and a small car - and the only thing worth discussing other than those are my outgoings.

My outgoings match my income to the pound and I really hope that they don't think I'm taking the mick. I worked out everything on a spreadsheet, almost down to the penny - and that showed a small surplus (but admittedly not a lot). For the online form I had to round everything to the nearest pound - and the exact match with my income is a fluke based on that rounding - it could have been a tenner up or a tenner down, but that's the way it worked out.

I put everything into my list of outgoings, trying to be as up-front as possible. I know some things will be denied, and that is fine. There are actually a few things (like clothing allowance) that I probably have set too low, and I haven't even got any entries for things like dentists, vets bills or holidays so maybe there will be swings and roundabouts. Maybe. I'm trying to anticipate as much as I possibly can, even down to the reasoning behind me really needing the car (or *a* car at least).

I've felt stressed the last few days, I don't know why. I'm sure the Official Receiver will be professional on Thursday and I know they will treat me courteously and fairly. I guess time will tell if the stress was required or not.

Monday, 23 November 2009

The Insolvency Service paperwork

A hectic weekend, but that's family life for you. After work on Monday I finally managed to take a look at the paperwork sent out by the Insolvency Service, and it seems pretty simple. My phone interview is on Thursday morning and I need to make sure they have the forms back with them by Wednesday. Not sure I'll trust the post - the Insolvency Service offices aren't that far away from where I work so hopefully I'll drop it in by hand on Wednesday morning.

So what have they sent me? Firstly, a few guides (I think I've also read these online on the Insolvency website ( - a useful source of information):
  • Guide to bankruptcy;
  • What will happen to my home;
  • What will happen to my bank account.
Nothing startling in any of these, thank goodness. Next I've got a few things to sign and send back. The contents of the pack were as follows:
  • A letter outlining what I need to sign and send back, it also tells me about the phone interview;
  • Form NTB2 - this basically means that they have my signature on a piece of paperwork that outlines the responsibilities of an undischarged bankrupt. Scary wording but no surprises (two copies, one of which I keep);
  • Form TNIDIS - which gives my permission for the Official Receiver to request information from the Inland Revenue and the Department for Work and Pensions;
  • Form NORD1 (actually I don't need to send this back - presumably it's here for reference) - which looks a bit like the TNIDIS form but for people I owe (owed, still find that difficult to remember) money to;
  • Form DPADA - which also looks a bit like the TNIDIS form but for people I owed - and I sign this one and send it back.
  • An ethnic monitoring form
  • A comments and suggestions card;
  • Finally, it also contained a handy map to get me to the Insolvency Service offices - usefully many of its directions actually refer to pubs and bars - handy for the newly bankrupted, I thought!
In a separate letter I have been given the chance of getting any beneficial interest in my house transferred back to me (as was first mentioned to me on the phone last week). I'm going to say that I want to buy this back but right now don't have a clue how I can raise the money to do this. Not only do I have to pay their solicitors fees (over £400) but I need to provide a current valuation - which will cost what? Around £300 for a valuation? Yet more money I don't have - I'm bankrupt for God's sake! It's a bit ironic, or what? Another problem I currently have is that I still need to finish raising the money for my wife to go bankrupt (but that's another story).

So, if you are reading this and you are not yet bankrupt - hide away your last few grand! You will need it!

On the good news side of things for today I received the details of my new Co-operative Cashminder account. Now I can give the sort code and bank account number to my work's payroll office and then sort out my direct debits. Just a shame I've got bugger-all money in there right now!

Saturday, 21 November 2009

Proposed changes to the bankruptcy process

A recent article in the Guardian - (13th. November) - outlines changes that the government want to make to the process of going bankrupt. I can understand the need for streamlining as the numbers are huge (140,000 insolvencies expected this year), but I'm worried that it will become a totally online experience with no requirement to visit the courts.

Even though beforehand I really didn't want to go to court I actually found the experience a worthwhile one. Not only was everyone very professional and, dare I say it, nice - but I believe that the part played by the judge was vital. Not only were his words remarkably comforting, but I see him as a sort of safety valve to the bankruptcy process.

Part of his role in all this is to actually look after our affairs, to make sure that this is the best option for us. I'm sure most of the judges hearings go exactly the same way, but if occasionally he looks at the details to someones proposed bankruptcy and thinks, 'no, this isn't right for this person', maybe recommending an IVA instead for example - isn't that worthwhile? Streamlining I'm all for, but don't take away the court visit!

The Insolvency Service paperwork is here

The paperwork from the Insolvency Service arrived yesterday. I've only had time for a quick glance through it but it doesn't look too onerous, I reckon I'll be able to turn it around and get it back to them on Monday morning. They want it back pretty quickly because they are planning to call me on Thursday morning. Once I've gone through the forms I'll let you know what it was all about.

Friday, 20 November 2009

Count on the Co-operative

After leaving the Law Courts on Tuesday I ambled slowly up the hill towards Grey Street. I felt a level of relief that I hadn't felt in quite some time, but I still had a niggle of anxiousness. Why? Because now I didn't have a bank account and I needed one.

I shouldn't have worried. I'd previously researched what banks were likely to accept me and I had a list of three - Barclays, The Co-operative and (according to the bankruptcy clerk) the Post Office. Well, I had gone bankrupt owing Barclays money, so I didn't see the point of trying there! So, the Co-operative it was, and handily it was on Grey Street.

As I sat down in front of the bank clerk I said that I wanted to open an account, but that it might be an issue because as of twenty minutes before I was an undischarged bankrupt. Without batting an eyelid she told me that was no problem and that she had opened accounts for plenty of people in my position. Phew! What a relief!

She went though the application on the computer, and - even though a credit check was part of the application (brief anxiety once more) - it was accepted. She told me I would get the paperwork within five working days. Excellent! The account is a Cashminder account, it doesn't offer any overdraft or credit facilities - but that is just what I need. A heart-felt thank you Co-operative Bank.

As I left the bank I could finally appreciate the day!

Thursday, 19 November 2009

Anything else I can do for you?

Last night I managed to raise a smile - something that I could not have even imagined only a few days ago. So how did it happen? Quite simple, I called the companies that I owe (owed, I have to let that sink in still) money to. All of them are banks or credit card companies, and all (almost all - Egg sent by far the fewest letters, MBNA sent tons of them) have been busy showering me with letters and phone calls so it was time to inform them of my bankruptcy. As I've said before, my policy had been to avoid the calls and to ignore the letters - not because I was hiding under a rock and ignoring my predicament but because I had nothing positive to say to them.

For each one the format was simple, I gave them the date of my bankruptcy and where, and gave my bankruptcy reference number. Everyone at the other end of the phone was polite and business-like. For the first time in months I left the phone plugged in to the wall for the *whole* night! Twice I received calls from companies I had already phoned myself and when I pointed this out both were very apologetic, promising no further calls.

I even made the guy at Egg laugh. 'Anything else I can do for you?' he said automatically at the end of my call to them.
'Well,' I said, 'I doubt it - you won't be giving me a new credit card any time soon, will you?'

You can't believe the sense of relief I'm beginning to feel.

One calamity away

My fellow bankruptees were average people just like you and me. As I said previously, six of us went bankrupt on the 17th. November in Newcastle. Maybe there were more in the afternoon, I don't know.

Three men, three women. Of the men, the other guys were both in their mid-thirties or early forties, both dressed as your typical tradesmen. Maybe they were plumbers or electricians, maybe they built swanky bathrooms, I don't know. They just looked like normal nice guys. Whether it was their business going down or just themselves personally I don't know either - both looked relieved on their way from the judge's chambers.

Of the women, one looked like your typical mid-forties housewife, one was a mid-thirties Goth, while the last looked hardly into her twenties. All the women had family or friends with them to support them, that was good to see.

We were all just normal folk. How many people out there are just one calamity away from being in our shoes?

Wednesday, 18 November 2009

Get in the queue (for bankruptcy)

The CAB people told me yesterday that during the Summer the waiting list for bankruptcy appointments at Newcastle Law Courts had been two months.

Unreal or what.

We are Borg

Bankruptcy references are a bit like a Borg name (Star Trek, if you didn't know). I am 5586 of 2009. (Not my real number, of course!)

The Insolvency Service calls

Got a call this morning from a chap from the Insolvency Service. He just wanted confirmation of a few things, basically stuff that was already on the forms that I submitted yesterday. He also told me that, if I wanted to sell my home, that I could 'buy out' for £411 the Official Receiver's stake on any profit from the sale of the property. I said it was a moot point as I was in quite a bit of negative equity and that it was our family's home - so I was both unlikely to want to sell, and there would be no profit anyway! He said he would put some things in the post anyway, and that there would be a few forms to fill in too, and could I send them back by return. He also mentioned that it might take 6 to 8 weeks for them to contact all of my creditors, and so in the meantime if I had any calls etc. that I needed to only quote my bankruptcy reference and point them to the Official Receiver's office.

Tuesday, 17 November 2009

Check your pockets

That's it, I'm bankrupt.

I'll give you the low-down in a moment but first I'd like to give my overriding thought of today, which is that the court staff were amazing - they were professional, relaxed, jocular at times (which helped!) and downright nice people. Everyone I talked to, the bankruptcy clerk, the ushers, the judge - all were amazing. They made a very difficult experience manageable.

Now the low-down. I was due at the Law Courts on Newcastle's Quayside at 11 this morning. I arrived too early and spent the best part of twenty minutes (each minute felt like an hour) wandering the Quayside, staring into the Tyne, wandering across theGateshead Millennium Bridge, and attempting to enjoy the cold but sunny morning. The sky was blue, not a cloud in sight, quite a beautiful morning, but one I didn't really appreciate.

With about twenty-five minutes to go I climbed the steps and entered the Law Courts. I didn't know what to expect, I'd never been in there before. It certainly wasn't likeRumpole of the Bailey, more mid-morning Tesco's crossed with airport security. Immediately on entering the building you come through a security door, I guess it's like a typical metal detector, while your bag is given the once over. Once through that I thought the help desk area was a little like it belonged to a downmarket office building - not the best decor, a couple of staff doing God knows what, the lifts and the door to the stairwell. I went up the stairs one level (I'd been told to go to the first floor on the phone last week), and hunted out the Bankruptcy Counter. It was in a small room to the right down a small corridor. Glass fronted, I could see the counter in question, the staff area behind it and a member of staff talking to a customer on my side of the counter (who I later identified as a fellowbankruptee ). Still being early I retraced my steps, found a waiting area and sat down, counting down the minutes incredibly slowly. The saving grace to the waiting area were the high, large windows overlooking the Tyne - it was still a typical November sunny morning out there in the real world.

At just before eleven I made my way back to the Bankruptcy Counter - a clerk greeted me and ushered me into an adjoining room where two other people were already sat across a table from me. 'These people are from the Citizen's Advice Bureau, do you mind if they observe?' I didn't. The clerk went through the forms with me, I signed where I was supposed to sign, and she efficiently went through all three copies - she was remarkably competent and managed to put me relatively at my ease. I pointed out the hieroglyphics from the night before and she simply said, 'Don't worry, if the Official Receiver needs more information they'll just ask.' Then she took the fee off me, all £510 of it (in mostly £20 notes with some £10s - strangely they didn't take credit cards! ;-) ), and disappeared to get my receipt for the cash. The man and the woman from the CAB were very friendly, when I said that I wasn't having my best of days the man simply pointed to a list of names on the paperwork left by the clerk and said, 'Don't worry, you're in company'. We passed the few minutes in chit-chat surrounding insolvency until the clerk returned with my receipt and my next instructions.

Next I was to wait to see the judge, who wouldn't see any bankruptees until 12. This was only just after ten past eleven (the forms had taken less than 15 minutes to process). First part of the process over I felt somewhat better and managed to relax just a little bit. After I had reported to the usher outside the District Judges area (I was simply asked to return at 12) I took a seat back near the front of the building in the waiting area outside Court 13. I managed to read a little - Moby Dick if you're interested, but mostly I took slow, deep breaths and watched the river outside the window and the cars passing on the road before the Courts. I texteed my wife, who sent a reassuring text back.

At 12 I reported back to the usher who proferred a seat in the waiting area next to his desk. At the time I didn't know it but I was surrounded by my fellow bankruptees. At about 15 minutes past another usher, in leagues with the first, began calling names from a handwritten list. It became obvious that the names were written poorly as a number of them were mispronounced and the two ushers treated it almost like a little joke - that they would have to complain to whoever produced the list. This simple jocularity eased the tension in the atmosphere and a few of us smiled at their antics. At no time were they unprofessional but they'd managed to soften the tone, to again help the process be more manageable for those being named bankrupt that day - and there were six of us..

I was last but one before the district judge at about twelve-twenty - four people had gone before me so you get a feel for how quick this part of the process was. Finally the usher escorted me to the judges chambers.

The judge was a distinguished chap in his sixties, smart suit, well-trimmed grey hair and a sharp intelligence glowing in his eyes. He sat at the top of a table shaped in the form of a 'T'. I was shown to a side of the table, opposite me sat the man and woman from the CAB - they weren't re-introduced and I don't really remember looking at them, my focus being solely on the judge. To the left of the judge another individual sat, again in a smart suit but younger, some court functionary I guessed. I don't know if the usher stayed in the room or not.

The judge started by saying, 'I well tell you what I tell all those that come before me. I'm not here to judge you or comment on how you got into debt. I am simply hear to see if bankruptcy is the best option for you. Now, your debts are £54000, have you got it?'
'No, I haven't' I said.
'Check your pockets,' he said. I swear, he really did.
'I haven't got anything in my pockets unfortunately,' I replied.
'No other means of paying?'
'If I had, judge, then I would have already payed it.'
'Fair enough,' he said. 'Well then, you have this debt, you don't have the means to cover the debt, therefore it's quite simple.' He signed his name on a piece of paper in front of him, 'Then I declare you bankrupt.'

I think I stuttered a 'thankyou', but I'm not sure how it came out.

'I want you to do three things,' he concluded. 'I want you to take this envelope back to the office where you were first dealt with. Second, you are to make no attempt to pay your creditors, as that is now a matter for the Official Receiver. And third, I want you to go home and get a really good night's sleep tonight. These debts are not to be worried about anymore, it's all behind you.'

What a judge.

Final thankyou's and I was out after probably less than two minutes.

I took the envelope with my paperwork back to the bankruptcy clerk. I guessed I expected more paperwork but she simply gave me a copy of the forms, now with my bankruptcy number on the top, she then told me to expect to hear from the Official Receiver in the next few days and then wished me luck. I checked that I was allowed to now open a new bank account, yes I was, and I was back on the street in front of the Courts by twelve thirty.

It was still sunny, quite cool, and a few clouds in the sky now. For the first time I appreciated the day as I walked slowly back up the hill into central Newcastle.

Monday, 16 November 2009

T minus 12 hours

Just over 12 hours to go. I've spent the last evening of non-bankruptcy finalising the forms on the insolvency website, suffering a few scares on the way, and then having my last glass of wine as a non-bankrupt and watching some normal TV to avoid thinking about the morning.

The scares were fun... firstly, I thought the whole insolvency website was down for maintenance (not so, they were advertising downtime for next week) and then filling in the forms one particular box was limited to only 200 characters - unfortunately I was trying to get about 400 characters of information in there, so after paring it down the box text looked like hieroglyphics. Lastly, I thought I was going to run out of paper while printing the forms - each set was 34 pages long and I needed three sets - had about ten sheets of A4 left at the end. Bullet dodged...

But that's it. Ready to go to court tomorrow... well, as ready as I'll ever be.

Friday, 13 November 2009

Tuesday is the day

Called up the Newcastle Law Court this lunchtime. I have to be at the Bankruptcy Counter on the first floor of the law courts at 11AM on Tuesday. Can you believe they have a service counter for this? I suppose I should have expected it - bankruptcy is as popular as getting a sandwich at Marks and Spencers these days.

All I have to take are my signed forms (my Statement of Affairs and my Debtors Petition) and a further two copies of both. Oh, and the fee. I'm not sure how I feel; Part of me feels relief that I will soon be doing something positive on my road to solvency - the other part is still finding this all too surreal and unbelievable.

Wednesday, 11 November 2009


Finally have all the money I need (£510) to go bankrupt - strangely it's a relief.

Remembrance Day

It's Remembrance Day today, an opportunity to remember those lost in war. It's a humbling day. My troubles are nothing compared to what many have gone through, and are still going through in places like Iraq and Afghanistan (and I mean on all sides). Like me, you will have ancestors who lived in troubled times, and like you, I realise the innate truth in the statement, 'There for the grace of God, go I'. This audio slide-show on the BBC website ( ) is remarkably poignant.

I am a lucky man indeed.

Monday, 9 November 2009


A bit stressed. Actually, that doesn't quite cover it - but it seems a bit rude to say 'REALLY F**KING HEART-ATTACK-IMMINENT CAN'T-TAKE-MUCH-MORE STRESSED!!!!' About one week to go. On the other hand, it's only money, there is FAR worse in the World... Feel better for getting that off my chest though :-)

Saturday, 7 November 2009

Downsizing the family car

This week I sold my largish car (7 seater Ford Galaxy type) for a small 3-door number. The old one was making some horrible noises and would have been too expensive to fix - the new one is poky in comparison but still gets us all from A to B. Will the Official Receiver let us keep it? The bottom line is 'I don't know'. It's value is somewhere between £3000 and £3500 and I've heard that the Official Receiver will go after vehicles worth more than £2000. We need a car, and I'll work to make that case - but I'm not getting attached to it. You never know.

Questions will be answered

You might have noticed that comments are disabled on this blog. This does not mean that I don't want to hear from you - far from it. Simply, the majority of blog comments I have ever seen are by idiots, or bigots, or idiot bigots. I don't need to read the views of a 17-year old from Tulsa with no life experience on the best ways to avoid debt, and neither do you. I won't sink to that level.

On this blog I will be as open and honest as I can (apart from, obviously, maintaining anonymity - mostly to protect my family). If you have something important to say or comment upon then please feel free to email me - averagejoegoesbankrupt(at) - and I will do my utmost to blog as complete an answer as I can.

Going off the radar

Obviously the banks are constantly trying to contact me, either via letter or by phone call. What really is the correct response? So far my approach has been to ignore all calls and letters,because I unfortunately realise that bankruptcy is my only option - and so there is nothing I can say or do to placate these organisations who are after me. If I answered their calls for example, what exactly could I say to them? 'Sorry, but I'll be bankrupt very soon, and you will then be able to contact the Official Receiver.'Would that do it? Or because , at that particular moment in time, I'm still the one to chase for my debt would they continue to call and write? I don't honestly know. If I could pay them, even if it was a smaller amount, or not to their timescale, I certainly *would* call them - but frankly, what is the point of doing that now?

Friday, 6 November 2009

And the winners are ...

And the winners are MBNA and Barclaycard - today I received letters from both stating that they are passing my details to a debt collection agency - in the case of MBNA (Virgin credit card) the payment they want to keep happy is a measly £77.


Nearly got the £510 together that I need to go bankrupt. Whoopee!! (I think)

Hanging (up) on the telephone

Phones again - getting calls at work and my work mobile. I understand that I owe them money, but should they be allowed to call me at work when I'm on someone else's time? Answers on a postcard...

It's a date

A date has been pencilled in the diary. A little under two weeks to go to B-day. I've been using to put in as much detail as I can to what will be my 'Statement of Affairs'. The online system has actually made it relatively easy but I still have some questions unanswered -how much detail do I put in my list of assets, for example? Like you, I've just got your typical house junk, what goes on the list and what doesn't? A couple of old TVs, probably not worth more than £100 each - do they go on? A 3 year old computer, probably not worth a light - does that go on? It would be easier if they said "put anything on the form worth more than X" ... X could be £50 or £100 or £200 - but it would make filling in the form easier.