Average Joe Goes Bankrupt

The view from the other side

2011-07-06T22:09:00.002+01:00

As you might have noticed - there is quite a gap since my last post.

Basically, I reached the point, about 6 months into the bankruptcy, where the rest of my world fell apart. My wife (and kids) left me and I went down hill rapidly. Many months of sickness followed, extended time off work, a complete meltdown.

And now I'm through it. I feel good (hopefully that isn't the drugs still) and I'm looking forward. I live a modest life, I am divorced, and I'm happy.

I'm still paying the Insolvency Service monthly, I still have little left at the end of the month, my credit rating is still at the centre of the Earth (in other words it can't get lower) but life has begun again.

Good luck to all in the same boat - you can survive this.

Six months (and a day)

2010-05-18T20:15:00.002+01:00

Here we are, half way.

For the first time in a very long time I feel human again - and it feels good. Last week I spent five days visiting an old (and wonderful) friend. I drank too much of his beer (not that he minded), we talked constantly (about everything under the sun), I discovered that he can't play poker (to save his life), and for the first time in aeons I feel fully refreshed. It's a long time since my batteries were full; a very long time.

I haven't posted much of late. Well, here's the revelation - on top of everything that the last year has brought my wife left me a few months ago; I was devastated. For the first time since then I am able to look forward rather than think of the past. It might be fleeting, but it's a feeling that I know will return, and it feels good.

The bankruptcy? Right now, I don't give a shit; I'm 45 and I'm trying to build my life from square one.

Thank you Gregor, and remember the guiding mantra from the Big Lebowski - 'Fuck it, Dude. Let's go bowling.'

Five months

2010-04-17T17:29:00.001+01:00

Is this how it's going to be from here on in - just counting the months? For good or bad life has achieved 'normality', whatever that means.

Five months. I'll give it another month and then risk a letter to the Insolvency Service to see what their intentions are (if any yet) about the house.

Four months

2010-03-18T14:34:00.001Z

Yesterday was exactly four months since my bankruptcy. Interestingly, I didn't notice - has real life finally replaced bankruptcy as my number one priority?

Last week I received confirmation of my Income Payment Agreement (IPA). I am to make all payments to a firm of solicitors based in the South of England called Moon Beever. My first payment is due soon - I've actually paid it already online and I'll set up a standing order for the rest of the payments. Glad I can actually begin payments.

Still no news on the house though.

A message from the BBC

2010-03-11T21:24:00.002Z

A few weeks ago I was contacted by a BBC researcher called Jonathan Davenport. He asked if I would be interested in appearing on a show due for broadcast on BBC TV sometime in July - the programme (actually a set of three programmes I think) is to cover many money related issues and as part of that they want to hear stories from people who have gone through insolvency. After much thought (you wouldn't believe how much) I decided to decline his offer. It was a very difficult decision as I feel very strongly that it is important to get our insolvency experiences to a wider audience - if only to counteract the ridiculous stories of bankers being paid millions in bonuses! Last year one in every 320 adults in our country went insolvent, one in ten never clear their overdrafts each month - we are a substantial group and our voices should be heard and our experiences should be told.

In the end my decision wasn't based on what my family and friends thought of me (everyone to a man has been totally supportive), but based on my work. I'm employed in quite a large organisation and there was always the possibility that my bankruptcy being made public could make my position untenable - and frankly I need the money. To assuage my guilt I offered to post a message on this blog for Jonathan - I hope that some of you will contact him. Here is his message:

Are you in an IVA/DMP or going bankrupt?

Have you had the right advice?

Do you want to share your story?

My name's Jonathan and I'm researching a new series for BBC 2 called Money Watch - looking at people's real life financial stories across the country. I'd like to hear your experiences about what it's like dealing with debt. If you're interested this could lead to some filming for the show. I look forward to hearing from you - my number's 020 8008 3989 or email's jonathan.davenport@bbc.co.uk

----------------------------

Jonathan Davenport

Money Watch

MC4 B4, BBC Media Centre

London, W12 7TQ

Tel: 020 8008 3989

2010-03-05T13:10:00.003Z

Received this recently from Marc :

Hi Joe,

I came across your blog this morning and have just spent 30 minutes browsing through it – shame I didn’t come across it earlier! I went through the bankruptcy process myself late last year and like you I found it all a bit surreal in the end. I declared bankruptcy in Hull along with 4 other people on the same day, also just average Joes, if you’ll pardon the expression! I’ve starting telling friends and family now, and they’ve been quite supportive. To be honest, I really ought to have confided in them earlier.

It really doesn’t surprise me the statistic you quote on your blog, about 1 in 320 people in 2009. The attitude and tactics of some of my creditors was pretty shocking, and caused so much stress. I wish I’d gone and made the petition for bankruptcy a year earlier already, there were just so many incidents of paying something off but ending up with a bigger bill by the end of the month. I certainly wasn’t helping myself, and given that I hadn’t been doing anything stupid or reckless to get in to debt it just made me so angry.

One of my childhood friends, it turns out, used to work for the Insolvency Service and we’ve decided to try to do something positive and offer advice to people who are going down the bankruptcy route. You wrote somewhere about having a grand or two stashed away at the end, and I couldn’t agree more! It came in so useful for all the little items, and the not so little items like the £510 fee itself – it’s just ridiculous, isn’t it? Our aim is to help honest people applying for bankruptcy do so in the most advantageous way for them. We put together our website, www.bankruptcy-angel.com just last week and would be honoured if you’d mention it on your site.

I look forward to reading more about how your bankruptcy period unfolds,

Kind regards, and good luck!

Marc

Disclaimer: I've not used any of their services, am not connected with any of them, receive no kick-backs whatsoever, and I'm not responsible for them. If you choose to give anyone any of your hard-earned cash then (as always) 'buyer beware'

One in Ten

2010-03-02T11:52:00.001Z

Another non-surprise (to those of us in the know) hit the headlines last week - more bad news for all the average Joes out there.

"Five million Britons are permanently overdrawn, and rising inflation could force more to live on their overdrafts, says product comparison website moneysupermarket.com."

From the Guardian, http://www.guardian.co.uk/money/2010/feb/23/five-million-brits-permanently-overdrawn

What's that, 1 in 10 of the adult population?

Accepting the Income Payment Agreement

2010-03-02T11:27:00.000Z

Life takes its toll occasionally, and so I've taken a brief break from writing about bankruptcy - for a while there I needed to remember that I'm simply a person too rather than just a bankruptee.

I now have some good news to report. The Official Receiver has reduced my Income Payment Agreement (IPA) payment to a lower (and payable) sum. I used the basis of the figures in Data for family expenditure (available as a spreadsheet from the Insolvency Service's website - www.insolvency.gov.uk/DocumentLibrary/Policy/Excel/Household%20Expenditur.xls) to challenge some of the Official Receiver's original views on my outgoings and I was successful in most areas. One thing surprised me - I wasn't allowed £20 a month to give the kids at least some enjoyable experiences during the holidays. No complaints though, I immediately signed the agreement and expect my copy through the post any day. I'm actually looking forward to beginning to pay the IPA - the sooner I start the sooner the 36th payment.

Still no news on the house - but I know I'll hear at some point and I'm not pressing for it.

Three months

2010-02-17T09:05:00.001Z

Three months into the bankruptcy. Doesn't time fly when you're having fun.

Poor Barclays

2010-02-16T16:33:00.001Z

Poor old Barclays, they only made a profit of 11.6 BILLION last year. What the hell is wrong with our civilisation?

BBC News story : UK bank Barclays reports profits up 92% to £11.6bn

'We were the same as you' - Penny's story

2010-02-10T12:13:00.008Z

This is Penny's story - thanks to Penny for allowing me to bring it to you all:

We went through similar problems about 8 years ago and entered an IVA in November 2002. Boy I wish your blog had been there then!

We both agree that the whole process of becoming insolvent, dealing with creditors and going into the IVA was the worst and best thing that ever happened to us. We had months of threatening phone calls, letters and stress and then the feeling that we were somehow morally lacking because we were in a financial mess and needed someone elses help to get us into the IVA.

We were the same as you - no exotic holidays (we have never taken a foreign holiday as they are too expensive), no flash or new cars (could only ever afford second hand ones), a smallish mortgage for our ex-council house and our food and clothes bills were very much made up of necessities rather than treats and luxuries. We both worked full time and at the time our four children were aged between 7 and 16.

We made ends meet with credit cards, catalogues (for clothes for the kids) and small bank loans for when we needed to replace the car. It didn't take much for us to cross the line into financial disaster. Although we entered the IVA with unsecured debts of 35k, what triggered the whole thing was a catalogue company starting court proceedings against us for a £230 bill. We had been struggling for a while by that point and had tried to reach agreements with the creditors, but the catalogue firm wouldn't play ball.

The sound of the phone ringing or post coming through the door was enough to send me running for the toilet to vomit (really) and X (my hubby) had a breakdown and needed 6 months off work - the last thing we needed at the time. Despite starting IVA proceedings, we still had letters and nasty phone calls until mid 2003 and after the IVA was made one of the banks tried to force us to sell the house for a 7k bank loan. This was totally illegal, but the stress of that set both of us back to square one emotionally.

To cut a long story short - we got through it and so will you. We paid off the IVA early (although the administrators didn't want us to) and we now have perfect credit scores. We still only have our little mortgage and only ever deal in cash - no overdrafts or cards and if we can't afford something we wait till we can. Its hard but my one fear in life is being back to where we were in 2002. It broke both of us emotionally and its taken us a long time to get over it.

Almost 8 years later we are wiser and far more appreciative of the things we have that don't cost money - its just a shame we had to hit rock bottom to realise it. Corny but true.

I think what I am trying to say is hang on in there. There is life after financial hell and at the end of the day its only money. If you haven't got it they can't take it and they can only take your dignity if you let them.

'I went the opposite way to bankruptcy' - Twonk's story

2010-02-09T12:35:00.003Z

I received a stunning email the other day from Twonk - and he was gracious enough to let me post it here:

i went the opposite way to bankruptcy:

i was working flat out more than 40 hours a week, getting nowhere, my wages just paid off credit card interest and late charges etc.

one card we had, allowed us to take a 3 month lower payment plan to get back on top of it, months later it was revealed on the statements that during the 3 months, the extra interest and charges they put on were more than i was paying originally, they may as well have kept us on the original plan and charged us as they were.

next up came the wife's card, her wage went in the bank a day late, when it finally landed, she rang her card company to make a payment over the phone.

i sat and listened as she paid the £78 monthly payment, only to see her face change from relief that she had paid it, to horror as she was being charged £25 for being one day late with her payment.

i took the phone off her and argued about it with the advisor and her manager, all to no avail.

after paying £78 off her bill, she actually ended up with a £12 higher bill, and her £78 quid counted for nothing.

that was the straw that broke the camel's back...... no more i told her!

i defaulted on the lot and waited for letters to arrive, some came within weeks, some took almost 12 months, after selling the debt onto collection agents and debt collectors.

i walked from my full time job, my attitude was, if i havent got nowt they cant take nowt.... by complete luck, it turned out to be a masterstroke.

to this day, every single one of our debts has been frozen at £5 per month, some with a court order saying it, some without, each one without adding interest or charges, no more hassles of mail drops, crafty postcards, threats of doorstep visits etc.

we have even beaten a top high st bank in court and stopped them from hitting our home with a charging order.

the way we did this was simple:

stopping all communication hassles - administration of justice act 1972 forbids "harrassment of a would be debtor" - which means phone and doorstep hassles stopped within two weeks, and was illegal, i sent letters out that communication would be dealt with in writing only, failure to adhere to this request meant i could walk into a police station and have the company charged if they didnt refrain from doing it. if a company are charged under this act, they could be deemed to be unfit to hold a consumer credit license - therefor they would not be able to trade anymore - i reminded them of this in the letters.

to date every single hassle has stopped, apart from the odd letter offering to knock 2 thousand off our bill total if we settle in full

the weight this lifted from us was immeasurable. i dont think people who are not in debt realise how much pressure all the phone calls and doorstep visits creates.

ignoring advice from the companies who we owed money to - first rule i set myself, was to trust the magistrates system instead of what we were being told by those we owed money to - i sussed out straight away, that the things we were being told were only designed to benefit them and not us.

like giving the company a break down of our income and expenditure (including all our other creditors) was a legal requirement... it is not, so i told them nothing - only the courts can demand a complete breakdown of income and outgoings by law.

like when the company told us we could only pay them a minimum amount each month that they would find acceptable - which was a lie - i wrote and offered them £5 per month and they refused the offer, i told them i wanted their decision in writing, only 1 company out of 12 gave us this in writing, as i could use it in court against them, as its simply not true.

i had to hassle them in writing for their sort code and account number, to pay in my £5 per calendar month, they often didnt want to give it to us, knowing as i did that should i have an established record of paying even a basic amount of money to them, the courts would pin them down on why they were bringing it to court in the first place when they were being paid regular (albeit minimal amounts) of legal tender and that we hadnt just ignored their requests for money.

i made sure i paid them £5 per calendar month religously, which showed any magistrate that we were true to our word.

contesting any charging order court application in person - the most important rule when companies tell people that a charging order against their home is "just a formality to secure the debt so they could accept our minimal payment" is that it simply is not true.

we had taken great care when using cards or getting a loan to make sure it was not secured against our home!

one company dropped a summons via the automated court system on our mat on christmas eve, after 11 months of saying it would goto court.

it is vital that this case was heard before a magistrate where i live - which is my right

once in court, the solicitor tried to get us to accept this clause immediately before we went in to see the magistrate, when i said i was defending against it he laughed and walked off.

when we got in to see the magistrate, the solicitor for the company stated that not only was he seeking the charging order, but also he wanted it enforcing immediately - meaning he was enforcing the sale of our home to get the 4 grand for his company - exactly the opposite we had been told by him and his legal letters for months!

when it came to our turn to speak, we gave the magistrate the "three strikes" defence:

- unfair advantage over other creditors

- we wanted a refund of all the extra interest charged from it being an unsecured loan as it would now be a secured loan

- the company refused to give us sort code and account number to make minimal payments which is against the law

the magistrate put these questions to their solicitor who looked ambling and turned greener with each one!

the charging order was refused and the minimal £5 payments were accepted by the judge.

in despiration, the solicitor argued that it would take 114 years to pay the debt off, the judge's reply was "tough!" times are hard for all concerned he said and ruled against it.

now we have this court order that stops a charging order, it means any other company trying this route will be refused as the law states that all creditors should be treated the same, and to grant one would give that company an unfair advantage over another company.

our lives have been transformed, i have a little part time job now, i dont have money in my pocket, because i dont need money in my pocket

we live basically, shopping away from supermarkets, knocking down independant shops in price, and we eat better than we have ever done, fresh fruit and veg, fresh meat every week, fresh fish etc.

i do jobs for people to help them out and in return they do jobs for me, no money needs to change hands.

we have no pressures anymore of creditors banging at the door, we dont dred the postman calling anymore, and we dont run around like headless chickens both working full time flat out, we have time to nip to the beach in an afternoon, or the park etc.

we smile and laugh at the simple things, we dont spend hours on the phone chasing around to get charges paid back... as we dont have any, we dont pay big wads of interest..... we should have done this years ago.

occasionally, i get a bit of cash in hand work, but on the whole, i work when i want to, no weekends, no late shifts, no sat in rush hour traffic for hours each week, etc.

sometimes its fun to watch all the neighbours running around like nutters and standing still!

Keep those emails coming please

2010-02-09T11:48:00.002Z

Since being linked to by the BBC News website I've had a fair few emails - please keep them coming, it's great to hear from you all. Some of you have been telling me about the routes you have taken through insolvency and there are some real eye-openers out there - stuff I wish I'd known over the last six months. With the permission of the individuals involved I hope to bring some of these emails into the blog - so stay tuned!

By the way, one particular reader told me that it was refreshing to read someone's insolvency experiences in a way that was informative without it being used to 'sell' him anything. Well, I'd like to confirm now to you all that this blog will never be used to sell anything, nor will it ever have adverts. This blog was never intended as a way to make money- I think I've proved I'm pretty crap with money anyway ;-)

Record breaking

2010-02-05T14:06:00.008Z

The BBC have covered the figures too: http://news.bbc.co.uk/1/hi/business/8499939.stm

"Over 2009 as a whole, there were 134,142 people declared insolvent in England and Wales. This was up 26% compared with 2008, and higher than the previous record - in 2006 - of 107,288. Records began in 1960."

There you go, I'm a record breaker - and I didn't even know it.

Update : I posted a comment on this page - in fact this:

I'm one of the 134,142 people declared insolvent last year - or to put it another way, I'm one of the 1 in 320 adults in England and Wales who became insolvent in 2009.

These days bankruptcy is seen as 'an easy way out of debt' - and I wouldn't be surprised if you received emails in this vein.

The truth is that bankruptcy is a terrifying experience. I'm about two and a half months into my bankruptcy and only now is my life attaining any level of normality - or rather a new normality. On my day in Court six of us were declared bankrupt - just average people that you would pass on the street - all walks of life, men, women, young, old.

What I would like everyone to know is that there are so many others out there living on this precipice - something like a million people. Before you judge these 134,142 individuals please remember the millions who are already sliding into this hole, and all those uncounted millions who are only one small disaster from being included in this year's figures. I hope you are not one of them.

On the basis of this I received an email from a BBC journalist doing a piece on the bankruptees side of the story, and so was interviewed over the phone for something like 15 to 20 minutes. I hope I gave him useful information - I tend to suffer from verbal diarrhoea when I'm talking about something I'm passionate about. He said there was a possibility that this blog might get linked to - I hope so, if it reaches a wider audience and helps one more poor soul going through insolvency then it's all worthwhile.

Update 2 : No link, but still they managed to make me sound coherent - thanks BBC!

http://news.bbc.co.uk/1/hi/business/8501489.stm

Update 3 : How nice of them - they added the link!

Tip of the iceberg

2010-02-05T13:25:00.002Z

No real surprise but in an article in the Guardian:

"Around a million people in the UK are struggling with debts without seeking help from their creditors, insolvency professionals said today."

http://www.guardian.co.uk/money/2010/feb/05/bankruptcy-figures-expected-record-high

This has similar figures to the report by Shelter last month, something I blogged about then.

The Grauniad covers the latest insolvency figures

2010-02-05T12:48:00.004Z

The Guardian covered the new figures today : http://www.guardian.co.uk/money/2010/feb/05/insolvency-figures-hit-record-high

Sorry, but I couldn't resist posting a message to them - amazing how little the average Gruaniad reader actually understands about the terrors of bankruptcy. I'm sure someone will shoot me down in flames, but it had to be said.

Update : Actually those that commented on my comment were largely supportive - chalk one up for our side.

(Lack of) money equals stress

2010-02-05T12:29:00.000Z

From the Guardian, Wednesday 3rd February 2010:

"Money worries are the main concern of stressed-out Britons, according to the result of a poll published today which reveals that as many as 40 million adults admit to suffering from some form of regular anxiety."

Read the whole thing at : http://www.guardian.co.uk/money/2010/feb/03/money-worries-britons-stress

How is your bankruptcy advertised?

2010-02-05T12:12:00.002Z

The following is part of an email reply I gave to someone recently - I thought it deserved a wider audience:

There are, as I understand it, two ways that your bankruptcy is advertised - and neither way is likely ever to reach people you know.

They put it in a paper in London called The London Gazette - 'one of the official journals of record of the British government' according to Wikipedia. They also have a website ( http://www.london-gazette.co.uk/ ). Nobody, apart from lawyers and ambulance chasers reads this. I have been able to find myself listed there, and they put in your full name, occupation and address - but as far as I can see this sort of thing doesn't end up in Google and other search engines (but I might be wrong - certainly I've tried various searches to try to make this pop out of Google associated with my name and I've failed every time). Interestingly, you might get a few letters from companies that deal with debt management once your name is in this - ignore the letters, they are scum!
You name is also put on the Insolvency Register which is linked from the Insolvency Service's website (http://www.insolvency.gov.uk/bankruptcy/bankruptcysearch.htm ). Again, no one reads this sort of stuff apart from lawyers and ambulance chasers...

So basically, my message is - don't worry. Once you are bankrupt life bizarrely goes on and even gets back to a form of normality. It's what I call a 'new normality' - normal, but not quite the same as before! Apart from the people I have specifically told - nobody know that I'm currently bankrupt, and indeed they need never know.

134,142

2010-02-05T12:06:00.005Z

These figures were released by the Insolvency Service this morning.

134,142 - That is the total number of individual insolvencies in England and Wales for 2009. Of this 74,670 were bankruptcies (me being one of them) - the numbers are up over 10% of the 2008 figure. Astoundingly this is approximately 1 in 320 of the adult population. Not only am I not alone, the chances are that if there isn't anyone else going through this in my street then they are pretty much only a street away.

Here is a graph, taken from the Insolvency Service statistics for 2009:

Check out http://www.insolvency.gov.uk/otherinformation/statistics/201002/index.htm for the full report.

Sobering, or what.

Mrs Average

2010-02-04T12:23:00.000Z

Mrs Average wants us to separate. What a year this has been.

How are Insolvency Service letters like buses?

2010-01-22T14:46:00.001Z

How are Insolvency Service letters like buses? When three come at once, of course.

So, some news at last, some of it good and some that needs to be challenged. First the good news - we get to keep the car and we don't have to 'buy' any interest in it, so that is a big relief. I never thought I'd be as relieved as this - I don't even like the damned noddy car - but at least it's ours and we don't have to go through the experience of having our car sold from under us. Chalk one up to our side for once!

Next up, on looking at the budget details that I gave them they want me to agree to an Income Payment Agreement of £300 per month for the next three years. Now, I was hoping to avoid an IPA, but I guess I did really expect one - after all I'm a bankrupt and the Insolvency Service has to do it's best to claw something back for my creditors (even if they are faceless banking corporations - the same bastards that screwed our country for years to come). The amount of £300 feels a bit steep - and frankly I don't know how I'll pay it at the moment - but the first step is to challenge some of the figures from the Insolvency Service; I have realised over the last couple of months that I missed a few things off that I'm able to claim for and so I'll have a go at reducing the IPA to something that feels a little more reasonable. Of course, I may not succeed - in which case I shut up and get on with paying, but I have to try.

Still no news on the house, but I guess I feel a little better that I'm close to an agreement on the IPA (even if it makes things tight for three years). I hope soon to be in the phase where I just get my head down, pay monthly what I need to pay, have no more scary paperwork to deal with - and get to the point where I'm no longer bankrupt. I realise that following that is still the huge stage of trying to recover my credit rating - but that is still a long way away, and one step at a time.

Two months

2010-01-17T13:22:00.000Z

Two months down. Still no news on the house or the car.

Worse than bankers

2010-01-16T08:11:00.002Z

I never thought it was possible, but there are some people in the world who are worse than bankers:

Thousands of households have taken out loans with interest rates averaging 825% during "the worst Christmas in a generation" for illegal doorstep lending, according to a new report.

Read the whole thing at : http://www.guardian.co.uk/money/2010/jan/15/loan-sharks-poorest-households (The Guardian, 15th. January, 2010)

Using plastic for rent

2010-01-12T21:32:00.000Z

No real surprise to those of us who have suffered or are in the process of suffering money problems - it has just been reported that up to a million families have had to resort to paying for their mortgage or rent with credit cards over the last year. Well done Shelter for exposing this, the following is a quote from the Guardian:

About 1 million families have resorted to using credit cards to pay their mortgage or rent during the past year, the housing charity Shelter claimed today.

A survey by the organisation found around 6% of households had used their plastic during the past 12 months, in order to keep up with their housing costs.

People in working class professions were most likely to use debt to cover their mortgage or rent at 8%, but 4% of ABC1s also admitted they had used their credit card in this way.

Read the whole thing at : http://www.guardian.co.uk/money/2010/jan/11/credit-card-mortgage-rent (The Guardian, 11th. January, 2010)

Too broke for bankruptcy

2010-01-06T21:30:00.000Z

My wife will be going bankrupt shortly too and the other day she called up the courts to book an appointment. To my surprise she could get in within 24 hours, and actually she had to decline the date as she hasn't filled in her Statement of Affairs yet. The lady at the court said that it was pretty quiet at the moment - this surprised me as I expected that many people would hold off going bankrupt until after the holidays. My wife, as ever, figured it out - nobody has the money to go bankrupt at the moment.

Unbelievable isn't it - right now people are too broke to go bankrupt. I guess the rush will be February.

Happy New Year

2010-01-06T21:25:00.005Z

Christmas and the New Year are now behind us and, most importantly, the kids had a great time. Hopefully they didn't spot much of a difference from previous years. Last year one of my New Year's resolutions was to reduce my debt - and it just goes to show that the saying 'be careful what you wish for, you may get it' is so true! Yes, here I am with far less debt than last year, but I would have never expected the means by which I reduced that debt! This year therefore I decided that my only resolution should be to make sure that I enjoy myself more - life is too short, after all. Last Saturday myself and a few friends went walking in Northumberland, along part of Hadrian's Wall - and it was glorious. You have to remember what is real.

Happy New Year.

(Thanks to Uncle Tone for the photo - Average Joe tackles the drifts next to Hadrian's Wall)

First milestone

2009-12-17T14:06:00.002Z

One month down, a maximum of eleven months to go.

MBNA - please get the message!

2009-12-15T19:58:00.003Z

Another exciting letter from MBNA - even though I think I've now told them twice that I'm bankrupt. Highlights of the latest letter:

If you do not contact our office within seven days on 0800 389 XXXX so we can discuss a repayment plan, we may recommend that our solicitors commence legal action. Depending on your locality, this would result in the following:

A county Court Judgement / Sheriff's Court Decree being registered against you, which may affect your ability to obtain future credit.

And then one of the following actions:

Your employer being ordered by the court to make deductions from your salary through an Attachment of Earnings / Earnings Arrestment.
A Bailiff / Officer of the Court / Enforcement Officer being instructed to execute an attachment over goods that you own to reclaim the value of outstandings.
A Charging Order / Inhibition Order / Order Charging Land being placed on your property which could result in any available funds being distributed to MBNA (a Bank of America company) following sale of your property.

Do not ignore this letter; call us immediately to make a debit card payment or advise us of your intentions.

Nice eh? So I called them up.

"I'd love to pay you, but as I've already told you, I'm bankrupt."

"Yes, sir. That's on our records. So just ignore the letter."

"But it's pretty threatening, can you stop more letters?"

"Yes sir, I realise."

"So will these threatening letters stop?"

"I can't stop them, we're Customer Relations. you need to talk to another department."

"But the letter said ring you."

"Yes, sir."

"I'm bankrupt, you've got a note of that. I'm not allowed to even try to pay you anything. So why the threatening letters?"

"Sorry sir, you'll have to talk to the other department."

So, another letter for the shredder. And I'm expecting more.

Our house is worth nothing - great!

2009-12-15T19:57:00.000Z

The Estate Agent today gave a lower estimate of the value of our house. Perversely this is a good thing - it shows us clearly in negative equity. I'll send this off to the Official Receiver and wait and see if they accept this valuation. Fingers well and truly crossed.

No news ... is still no news

2009-12-14T12:48:00.002Z

A letter from the Insolvency Service, but still no information. They want to know about the sale of my previous car, some of the details in my outgoings (that I couldn't describe in the online Statement of Affairs as the box was only 200 characters) and other odds and sods. No news on what is happening with the new itty-bitty car - I'm learning to be humble.

Getting another Estate Agent to view the house tomorrow - hopefully they'll have a more realistic figure for the worth of the house (and even more hopefully - a valuation that is in our favour would be nice).

Ambulance chasers

2009-12-05T14:52:00.001Z

Another ambulance chaser - Turnaround Finance - sent a very nice brochure offering a solution to all my problems. Scumbags.

Failure rates for IVAs - nearly 1 in 3

2009-12-04T19:59:00.002Z

I found a very useful link on the http://www.bankruptcyhelp.org.uk/ website posted by a user called DebtInfo (thank you my friend). The link is to the official figures for IVAs, including all failures (it's in spreadsheet format). Basically it shows that the typical failure rate for IVAs runs at about 30%. That's almost 1 in 3.

With my situation I discounted IVAs relatively easily. These figures should be examined by anyone wanting to take up an IVA - I'm not against IVAs, but I think people should know what they are getting in to.

Egg cares

2009-12-04T19:52:00.001Z

I want to report a great letter from Egg where they confirmed my bankruptcy details. There is a nice paragraph near the bottom:

"We will be seeking payment from you for the full amount that you owe us under this agreement as at the date of your Bankruptcy / Sequestration and we will be negotiating with the Official Receiver for payment of this sum."

Friendly of them, eh? Look, I'm bankrupt. Quite frankly I rather wish I wasn't bankrupt, but that is the situation I find myself in. I would have liked to have paid them in full! How the bloody hell do they think that such a paragraph would help them get more money off me?!

Left at the (sacrificial) altar

2009-12-04T16:17:00.001Z

It's been a heck of a few weeks. The actual process of getting prepared for bankruptcy, attending court and then talking with the Official Receivers office was hectic and very stressful. Two weeks on and I feel a bit like I've been forgotten, like I'm in a sort of bankruptcy limbo.

My only assets are a house (that I had believed was a long way into negative equity) and a cheapish car. I still don't know if we will lose the car or not as I've never had anyone come back to me to tell me what they think it's worth at auction. This isn't a dig at the Insolvency Service, I bet their workload is enormous.

As to the house, the first valuation I received (admittedly with an Estate Agent, who tend to talk properties up) was a whole lot higher than I expected. Good news in one sense in that I'm not in the huge property hole that I thought I was, but on the down side I'm on the verge of having a property that is worth something to the Official Receiver. Not that I want to hoodwink anyone, if it's really worth more then it's worth more and the Official Receivers Office can do what they wish with my assets - they control them. I guess I'm learning that I have to be flexible.

My old 'friends', the credit card companies and banks, call occasionally but only to confirm that they have to call me occasionally until they hear from the Official Receiver. Yesterday it was Nationwide, today it was MBNA.

I still smart occasionally at the sound of phones, but it's getting better. Why am I left feeling like a bride at the altar?

Debt collectors hit out at advice websites

2009-12-04T16:16:00.000Z

I find this comical. Debt collectors are getting upset with us! Who would have thought that debt collectors are a persecuted minority? Bless!

"Debt collectors are planning ways to hit back against online consumer forums allowing people to share advice about dealing with debt problems and taking on financial institutions.

The Credit Services Association (CSA), the main trade body for debt collectors, has held workshops for its members to explore ways of "combating" organisations such as the Consumer Action Group (CAG), a forum with almost 250,000 members.

A CSA PowerPoint presentation, seen by the Guardian, claims such sites are guilty of "encouraging" people to evade debts, provide "breeding grounds for misinformation" and "insult" banks and debt collectors."

Read the whole thing at : http://www.guardian.co.uk/money/2009/dec/02/credit-services-association-debt-websites (The Guardian, 2nd. December, 2009)

Update on my only two assets

2009-12-03T20:35:00.002Z

No news is good news, the saying goes. No news for us means still not knowing (after almost a week) if we will lose our car or not. I don't want to hassle the Insolvency Service, but I am surprised I haven't heard anything by now.

On another note, my wife and I had our home valued by a local estate agent today. To our utter surprise, the answer was around £200K. We thought it would be much lower - the upshot of this is that we are on the borderline whether will be offered to buy the interest in the house from the Official Receiver or not. Needless to say we will get valuations from other estate agents and if they are all in the same ball park then we need to get a proper bank valuation. This will cost us yet more money we haven't got but might give a more accurate value (and show what we believe - that we are still in negative equity). I never ever thought that I'd want to be in negative equity!

The Official Receiver calls

2009-11-27T12:09:00.002Z

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...

Waiting for the call

2009-11-26T09:25:00.002Z

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.

The Bank of Scotland sends a nice letter

2009-11-25T20:49:00.001Z

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

2009-11-25T20:47:00.001Z

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

2009-11-25T09:19:00.001Z

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!

Preparing to talk to the Official Receiver

2009-11-24T20:48:00.001Z

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.

The Insolvency Service paperwork

2009-11-23T21:39:00.003Z

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 ( http://www.insolvency.gov.uk - 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!

Proposed changes to the bankruptcy process

2009-11-21T08:26:00.003Z

A recent article in the Guardian - http://www.guardian.co.uk/money/2009/nov/13/bankruptcy-orders-ivas-online (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

2009-11-21T07:53:00.001Z

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.

Count on the Co-operative

2009-11-20T10:56:00.002Z

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!

Anything else I can do for you?

2009-11-19T12:51:00.001Z

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

2009-11-19T12:08:00.001Z

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?

Get in the queue (for bankruptcy)

2009-11-18T22:12:00.005Z

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

2009-11-18T16:38:00.001Z

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

2009-11-18T16:37:00.002Z

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.

Check your pockets

2009-11-17T21:44:00.002Z

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.

T minus 12 hours

2009-11-16T22:39:00.002Z

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.

Tuesday is the day

2009-11-13T19:44:00.001Z

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.

Relief

2009-11-11T13:57:00.001Z

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

Remembrance Day

2009-11-11T13:55:00.001Z

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 ( http://news.bbc.co.uk/1/hi/uk/8352507.stm ) is remarkably poignant.

I am a lucky man indeed.

Stress!

2009-11-09T20:00:00.002Z

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 :-)

Downsizing the family car

2009-11-07T17:25:00.000Z

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

2009-11-07T12:47:00.000Z

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)gmail.com - and I will do my utmost to blog as complete an answer as I can.

Going off the radar

2009-11-07T12:36:00.000Z

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?

And the winners are ...

2009-11-06T20:07:00.002Z

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.

Whoopee?

2009-11-06T20:07:00.001Z

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

Hanging (up) on the telephone

2009-11-06T20:05:00.000Z

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

2009-11-06T20:04:00.000Z

A date has been pencilled in the diary. A little under two weeks to go to B-day. I've been using https://www.insolvencydirect.gov.uk/isolv/ 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.

Objects in the mirror might be closer than you think

2009-10-29T16:29:00.001Z

Minor scare yesterday. Found out from our payroll department that the deadline to change my bank account (to get my pay into) is late next week - about a week earlier than I thought. That suddenly meant a lot of things needed to be done even more urgently to prepare for imminent bankruptcy than I had expected. Panic! Sorted it out this morning however - payroll will accept my wife's bank account number - so now back to having time to sort things right. Hopefully.

Nearly made it too

2009-10-29T16:28:00.001Z

Even six months ago I didn't see this coming. To an outsider it might have been obvious, but it certainly wasn't to me. Like a lot of people (in the UK something like a million people are either on the edge of, or have dived into, insolvency) using credit cards was a daily activity. Not for holidays, not for luxuries, for food, for stuff for the kids, for everyday living. Over the last few years I knew my debt had risen sharply, after all, the cost of everything has gone up - food, electricity, gas; at our last mortgage review we picked a really bad deal too. My wife and I, although concerned, really didn't see the end coming - one of the things that I'm not looking forward to is the Official Receiver going over the numbers and saying 'you really didn't get it? are you mad?' And maybe he will be right. We just thought that we would (again) pull the rabbit out of the hat. My wife has a weird sort of job where she can earn a large chunk of cash in one go, a deal was on the horizon, looked a dead cert, this was the life-saver on it's way. And then after one phone call the deal was dead.

If we made any mistake it was to tie the potential of this deal coming off with it being our saviour. But then again, that's how most companies go down too - pushing everything to get that one extra order, hope while the order is on the cards, despair when the order dissappears in a puff of smoke.

That's life, I'm going bankrupt for £50K. Say it fast and it doesn't sound much, does it? Bugger, we nearly made it too.

No to the bridge option

2009-10-27T12:23:00.002Z

Every day I have a few moments of terror. Less than a couple of minutes worth at the moment, normally coming in 10 to 30 second chunks. Often caused by the sound of a telephone ringing somewhere, or at the point the enormity of bankruptcy comes home to me yet again. I'm coping, but in those few moments each day I can see why debt is one of the largest causes of suicide in this country, because in those few seconds I can truly understand how jumping off a bridge might just seem a plausible solution.

Run, fat boy, run

2009-10-27T12:23:00.001Z

Stress is a killer. Depression is a killer. To combat both I run every morning; I've learnt that the route to mental health is through physical health. I'm slow, I'll not win any races. But for those forty odd minutes each morning I can be free, enjoying life, and enjoying the views along the North-East coast where I run (there are some stunning sunrises at the moment). After a run I reach a sense of balance that gets me through the day, that helps me see the wood AND the trees.

Z is for Zen

2009-10-27T12:22:00.001Z

I think my wife is turning Zen Buddhist. She said something the other day that just hit the nail on the head. "This is silly, we are doing this wrong. We are focussing all our energy on what we don't have and what we can't have. We are really lucky, we should focus on what we have and remember how lucky we actually are."

Yes, I know - it's obvious, but it's amazing how stress sends you down the wrong path. We are all healthy, the kids eat hot meals, we all have nice beds, nobody is looking to put me against a wall and shoot me. We are luckier than the majority of people on this planet - and it's churlish to dwell on what we don't have. Life can be humbling, and it can be good.

Rising UK debt

2009-10-27T12:16:00.001Z

Debt in this country is rising rapidly, thanks Gordon. The banks are OK, it looks like big banker's bonuses are still on the cards, it's just us average Joe's that you aren't interested in helping.

"A record 33,073 people in England and Wales were declared insolvent during the three months to the end of June, sparking predictions that the total number of individuals to go bust would break the 130,000 barrier by the end of the year." - "Insolvency figures hit record high", The Guardian, 7th. August, 2009.

Most of those poor people (no pun intended) will go down the IVA route rather than bankruptcy. Around 30% of IVAs fail resulting in bankruptcy anyway (I've seen some figures that estimate this as being nearer an astonishing 60%).

They are there for you

2009-10-27T12:15:00.001Z

Friends and family are amazing. They are the best support you can ever get. They will surprise you. Enough said.

Phones

2009-10-27T12:12:00.000Z

Phones are my greatest terror right now. I can be pretty cool, coping with all life throws my way - right up to the point a phone rings, and then my heart misses a beat. The moment I stopped paying my credit cards (not a life choice unfortunately) the calls started. Banks are pretty smart and know how to use technology to hound you. Basically there are 3 types of calls you will get in the early days of missing payments:

1. Automated - 'This is bank X, please call us back on 0800-XXX XXXX to discuss an urgent matter';
2. A real person - pretty much the same as above. The person will sound *really* bored, but then you would be if you had to make those calls all day;
3. A real person - 'Hi, this is a call for Joe, could you call me back on XXX XXXX soon? Thanks.' This person sounds suave, this person is 'your mate' (TM) The Banks.

If I had the chance to give any advice it would be this: Never EVER give phone or mobile numbers to you bank or credit card companies. These contact details are NEVER in your favour, they are totally there in the bank's favour. Miss one single payment and you'll find out what I mean.

The other thing to remember is that if they call your mobile - NEVER answer. Eventually they will give up on mobile numbers, most probably assuming you've changed numbers. Unfortunately this doesn't apply to your home fixed phone line. They will pretty much call this at whim constantly. OK, 'constantly' is an overstatement - I've received 3 calls in the space of 10 minutes, and then nothing for a few hours. I've had calls in the early morning and late evening (and everything in between).

You eventually reach the point (quite quickly) of pulling the phone socket from the wall.

Give it a little while longer and any slight vibrating noise just below proper earshot becomes a phone call - and you start spooking at anything. It gets to feel like you are being hunted. Then again, it's probably because you are being hunted.

B is for Bankruptcy

2009-10-26T16:19:00.000Z

Call me Joe. I'm an average guy. I live in the North-East of England, I work in IT, I have a wife and family, I have everyday hopes and dreams - I'm just like you. You wouldn't pick me out of a line-up or pass me a glance if we passed each other in the street. Like I said, I'm just an average guy. And I'm going bankrupt in the next few weeks. I'm not exactly relishing the thought but one thing I have figured out is that by understanding what is happening, and going to happen, I can reduce (to almost manageable levels) the terror that the threat of bankruptcy brings. On the off-chance that this blog helps even a single soul in the same mess then, if you don't mind, I'll bring you along for the ride. Time will tell if it's a roller-coaster or a car crash.