A Free Bankruptcy, IVA And Simple IVA, Insolvency Advice Forum

[hiho]

We hear a lot about people in the process of going through bankruptcy and each case is individual. We hear about the stress and worry it causes as well as the practicalities and form filling which has to be done.

What we don't hear much about (or enough about) is what life is like after the event. How do you feel? Has you attitude towards debt, bankruptcy and lending changed? Are your emotions all over the place or are you now leading a happy and comfortable stress free life? How have you managed since being made bankrupt? Have you told many people? Are you back on the credit ladder?

Please share your stories with us and help give others an insight to what happens next.

Thanks

[km44]

I have been thinking and there must be a financial buisiness opportunity out there. All Bancrupt or post Bancrupts are after Bancruptsy in fact more financialy sound than most normaly indebted persons.
Clear of debt, know better and some if not most employed. I realise there credit score will be at Zero but a morgage is secured on a property for an instance.
How many Bancruptsy's have there been in the last 5 years and the figure is growing yearly. Surely there could be some flexibility in the system if a Bank or a Financial institution was to buck the system. ???
Or are they not allowed ??

[hiho]

KM44, there will always be people and companies out there trying to profiteer from other peoples misfortunes. However what we're really interested in is getting an insite to how people lives move on after bankruptcy and how it's affected them.

[SEP1]

Hiho,

It appears that you are under the misunderstanding that the grass is greener after bankruptcy.

After being bankrupt for a period of nearly three years and now having been discharged for nearly two - I feel that I am still seen as being bankrupt.

I still have a very basic bank account without a chequebook or switch card and it is very difficult to open new utility accounts etc.

My bank tells me that they are not in a position to upgrade my basic account to a current account and therefore I have to keep applying, which then has a negative impact on my credit rating. A recent application I have just made to my own bank has been declined.

Not having a proper account prevents me from obtaining credit e.g. some utility suppliers or getting general better deals. As I have no switch card I am unable to pay for goods over the phone or internet and thereby do not get the best options available and always have to pay the higher cost.

I have updated my credit reference reports, which periodically errors occur e.g. old accounts being sold to different companies and re-activated as a current debt, but I have to keep paying the £2 fee to each agency when I wish to check the contents. I also feel that some of these reports are not very clear / readable and probably I am overlooking errors. The credit reference agencies are not that approachable and always try to refer you back the former lenders or also say that they just follow the creditors instructions – however the creditors tend to refer matters back to the credit reference agencies. The information on the credit reports contradict each other some of my former lenders show settled and others partially settled due to the bankruptcy.

There is very limited support available for people after bankruptcy and for me I feel that I am still bankrupt due to how people look at my former credit status.

[sandra]

Regarding bank accounts have you tried the Co-op Cashminder? They are one of only four banks who allow undischarged bankrupts an account so I should think that you won't have a problem with them. You can apply over the phone or in person. You can take money out from any Post Office or machine. The account comes with a Visa Electron card.

Also, you need one of these -

http://myvesta.org.uk/cashplus

It is a prepaid Mastercard but not a credit card. You put money onto it and then use it like a credit card. I have had mine since last October and find it invaluable for the internet, Ebay or in shops.

Do have a look.

Thanks for sharing the downsides of bankruptcy with the Forum. Bankruptcy is something that you really have to have gone through yourself in order to fully realise the implications of it.

[SEP1]

Sandra,

Thanks for your reply.

I have actually been discharged from bankruptcy for nearly 2 years now, however thank you for highlighting the pre-paid credit cards. This is something I am currently looking into but these cards generally have a joining fee that needs to be paid by a creditcard - also people need to be aware of the additional charges these cards hold! monthly costs / withdrawal fees etc. As highlighted in my earlier message only the more expensive options are available to individuals discharged from bankruptcy.

The Co-op was a no!

Having had your card since October Sandra have you managed to obtain a switchard / or a real creditcard yet?

[sandra]

I cannot use a "real" creditcard since I am in a 100% lump sum IVA. I will never ever use a "real" credit card again, if I live to be 100. Now I have got rid of my debts they are staying lost!

My visa electron works like a switchcard.

The Myvesta Cashplus card is not expensive to use. The set-up fee was paid at the shop where I registered. The monthly fee of £4.95 is quite reasonable, depending on how much you use it. Or you can switch to £1 per transaction if you aren't going to use it much, then increase it to the £4.95 flatrate in November ready for Christmas shopping or whatever.
I have no objection to the £4.95 since I use my Cashplus card a lot - I buy all sorts on Ebay for a start. I have just bought a brand new with tags suit for work on Ebay.com (USA) for $9 + $16 p&p = under £15!

The Nationwide and Abbey both give a debit card as far as I know. Have you tried there?

[hiho]

Hi Sep1

I'm sorry if you felt that I had misunderstood you. Life after bankruptcy is different for everyone. Each case is individual. All we're trying to do is to get a better insight of how people cope after bankruptcy. For some the grass may be greener, for others it may continue to be a living nightmare.

By sharing post bankruptcy stories on the forum, it may help to give some support to others who are going through it.

I'm sorry to hear you've had a rough time since your bankruptcy and sincerely hope that things start to look up for you soon.

[SEP1]

That’s OK hiho,

I think people should be made aware that once you have been discharged from bankruptcy things don’t get better immediately and for me its been nearly 2 years.

As indicated earlier I just want a bank account that will provide me with a switch card, which I would use as a debit card – I do not even want credit!

I think people should not rush into getting a pre-paid card as these cost for just having the privilege of such a card. The card Sandra mentioned cost 4.95 per month + the joining fee £9.95 = £69.35 in the first year for not even obtaining credit.

Has anyone discovered a cheaper option?

[lornsxx]

Regarding bank accounts have you tried the Co-op Cashminder? They are one of only four banks who allow undischarged bankrupts an account so I should think that you won't have a problem with them. You can apply over the phone or in person. You can take money out from any Post Office or machine. The account comes with a Visa Electron card.

Also, you need one of these -

http://myvesta.org.uk/cashplus

It is a prepaid Mastercard but not a credit card. You put money onto it and then use it like a credit card. I have had mine since last October and find it invaluable for the internet, Ebay or in shops.

Do have a look.

Thanks for sharing the downsides of bankruptcy with the Forum. Bankruptcy is something that you really have to have gone through yourself in order to fully realise the implications of it.

Hello Sandra,

I have just joined this messageboard. Would like to know if you can SELL on ebay using the cashplus prepaid mastercard? Can it credit funds to the account this way? And if so, does it charge each time funds are credited to the account?? I am now a lone parent on benefits, have just been discharged from bankruptcy, cannot get a visa-type function anywhere else but need to sell some things on ebay to top-up my income...I am desperate!
lornsxx

[hiho]

There's no reason why you can't use it on Ebay as far as I'm aware.

Ebay will also accept direct debits as well as debit and credit cards, so if they don't accept pre-paid, then you could always set up a direct debit.

Hope that this helps.

[lornsxx]

Thanks for your reply Sandra. So if I SELL an item on ebay, through Paypal, the customer's money can be credited to the cashplus gold prepaid Mastercard...is that right?? It's just that on the cashplus gold prepaid Mastercard webiste it says that the only methods of "reloading" the card are through the post office, a designated retail outlet, or standing order from your bank. Maybe I am just not getting it!!

Thanks so much for your time.
lornsxx

[lornsxx]

Sorry, need a bit more practice with message boards...my reply should have gone to "hiho" sorry hiho!

lornsxx

[sandra]

Hi

I haven't been able to get my Ebay payments across to my cashplus card because - as far as Ebay is concerned - it is a "credit" card - it does have a mastercard number. On Ebay you can only transfer money from paypal to a bank account not to a credit card. But - I pay for my Ebay items using my cashplus card directly!! If that makes sense!

Then I transfer any monies from paypal payments from Sales to my co-op bank account. This is the only way Ebay allow me to do it, unless anyone here has found a way around the system? I haven't sold anything since before Christmas, it is time I had a clearout of some clothes that I will never wear again.

Hope this helps!

[km44]

Hi to sep1 and lorns,
I have set up my ebay account with my Nationwide basic account and use my pre pay mastercard as a backup if required. This works fine for buying and selling.
As for the grass being greener it certainly is for us.
We are recently Bankrupt so all our creditor worries which were great are gone. We have a basic account with a cashcard and find like sandra the pre paid mastercard a certain asset. The fees are a lot less than the interest you could acrue if temptation or need had you using a credit, credit card. Early days yet but it most certainly has us looking to the positive, our glass is half full and not half empty. Good luck to all.

[lornsxx]

Hello Sandra, and km44,

thanks for your replies. I feel a lot more hopeful now. Sandra, I think you might have mentioned before that your basic co-op bank account comes with a visa function..? Well I only have at present a very basic barclays account that has no visa/electron function or chequebook etc. Can paypal transfer funds to my bank with just a sort code and account number? I will apply for the co-op account in time. I was discharged in December 2006, so very recently, and an advisor told me today that I need to send copies of my discharge certificate to the credit reference agencies e.g. experian.

lornsxx

[sandra]

Hi,

Yes you only need your bank account number and sort code so you will be okay to use the account you have already.

The OR should give you a letter of discharge.

If you have your barclays account and a myvesta cashplus card you really have all you need!

good luck selling!

[lornsxx]

Thanks Sandra, you have really put my mind at rest! So glad I found this website today. Good luck to you too.
lornsxx

[stevemcg12345]

i was made bankrupt in 2003 i have been discharged for over a year now i approached my bank to ask if i could upgrade from the basic account but had no joy ,is there any advice you can give on how to get my credit rating back off the ground as i am finding life after bankruptsy very hard indeed the bank's explination for not upgrading the account was that i failed there credit scoring system because i have no credit ,its just one big vicious circle i can't seem to get out of.

[SEP1]

This is exactly the same problem as I am having. I have had a recent application again declined and again no reason given. The bank did ask to see my discharge certificate again even though I had attached a copy to the application. They did say they would allow me a basic account if the discharge certificate was supplied (even though I already had a basic account with them) - I think my bank now has 4 copies of this document already. I have asked for them to return them now considering that they cost £60 in the first place to obtain. They have returned only 1 copy to date.

It appears that the banks check your credit worthiness with one of the credit reference agencies only but do not actually look at the application itself and read what is actually in the application. In my case they would have seen that I already have a basic account with them.

How long will the banks keep declining applications for - after you have been discharged from bankruptcy? Do they work by a set rules of their own?

It is such a frustrating process!

[sandra]

Have you made sure that your CRF is up to date?

If the bank asks if you have been bankrupt you must tell them but if the question is not there you don't need to.

If your CRF is not correct it must be amended -

As soon as you are discharged from bankruptcy it is wise to make sure that your Credit Reference Files are showing the correct data. This will not be easy and needs perseverence to see it through. First step is to get copies of all three CRFs from the CRAs, which are:

Experian Ltd
Consumer Help Service
PO Box 8000
Nottingham
NG80 7WF
Tel No 0870 241 6212
www.experian.co.uk
(You can order your credit file on the internet or by telephone).

Equifax Plc
Credit File Advice Centre
PO Box 1140
Bradford
BD1 5US
Tel No 0870 010 0583
www.equifax.co.uk
(you can order your credit file on the internet)

Callcredit plc
Consumer Services Team
P O Box 491
Leeds
LS1 5XX
Tel No 0870 060 1414
www.callcredit.plc.uk

You should send the request for your file, enclosing £2.00 and your address(es) for the last six years.

Once you have your files, you may find that your discharge from bankruptcy is not showing. The first thing then, is to inform the CRA that you were discharged from bankruptcy on such and such date and you will need to send proof of your discharge. This can be by obtaining a copy of your discharge from the Court which will cost £60 unless you are on benefits then the charge can be waived by filling in a P160 Form. You will need to make several copies of this Certificate of Discharge. Another way you might try, is to ask your OR for a letter confirming your discharge. A third way is, if your entry is still showing on the Insolvency Register with the discharge date, then you could print off copies to send to the CRAs.
That is phase one and the easy part.

On looking through your file, you will or should see, defaults against your former debts. These defaults should be no later than the date of your Bankruptcy Order. This is important! Your BO will fall off automatically on the 6th anniversary. Where there are defaults registered after the date of your BO, they will stay on later than your BO, which of course is wrong. You will then need to ask the lenders to update their data. Not only that but they must also mark their entries as either "Settled" or "Satisfied".

Some lenders may prove to be belligerent about this but they are wrong. The correct procedure to lenders is laid down by the Information Commissiioner who oversees the Data Protection Act which states that all records held by Agencies must be truthful. There follows the ICs ruling on former debts in bankruptcy. This could also be copied and sent along with your request to have your files corrected by the lenders:


Information Commissioner, Wycliffe House, Wilmslow, Cheshire, SK9 5AF
www.informationcommissioner.gov.uk

[SEP1]

An interesting point is that credit reference agencies are now using the wording 'partial satifisfaction' which they say is in line with the normnal data reporting requirement.

Is there any other advice that can be given other than the Credit Reference Adencies or is this really just an indefenite waiting game now!

[sandra]

Since the credit checks are done through one of the main three CRA's it is important that those files are correct.

Unless someone else has some ideas I cannot see how your situation can be improved.

[SEP1]

It would be nice that when an applicatiion is declined you are actually told why. Being referred to one of the credit reference agencies is v. unhelpful - I know that I was bankrupt & aware of my past adverse credit history!

[hiho]

If you're declined for credit, the financial insitution legally does not have to tell you why. Most of the time however, it's due to adverse information, bankrupty, CCJ, defaults, arrears, fraud, CAIS, CIFAS, over committal or just a low credit score.

You can have a low credit score if you've never had any credit in your name. Believe it or not, it's good to have a bit of debt as long as repayments are up to date. This helps increase your credit score.