Case examples of people who have gone bankrupt in England

Brendan has asked me to post up some case studies of people who have gone bankrupt in England.

For obvious reasons I am not using names.

Study 1
H and W from Dublin with a young child.
H loses job and the property bought at the height of boom, can't be afforded.
W has relations in Wales.
They decide that pressure is too much and so hand back keys and move to Wales in October 2009.
They have negative equity of €250,000.
They cannot get work in Wales. They live with family.
They both go bankrupt in March 2010. It all goes smoothly.
10 months after they went bankrupt they move back to Dublin, find work and rent.
Both now discharged and very happy.

Study 2
Single man from Cork.
No ties but family in town outside London.
He has €400,000 from a failed series of businesses taken down by the recession.
No job and no prospect of paying it off.
He moves to his relatives in May 2010.
He goes bankrupt in September 2010. He has a quick interview with his OR and then hears nothing from him again.
He cannot get work here but he is out of bankruptcy automatically in September 2011.
He went back home in July 2011

Study 3
Debtor and fiance.
Investment property and family home debt to the value of €500,000.
They spend all their savings trying to save their investment. It fails as the money is simply thrown into an endless pit. They exhaust their savings and have no choice but to move to UK.
They re-locate to Liverpool and he gets work in July 2011.
After four months he makes his application to court. His bankruptcy is approved in November 2011.
He has spoken to the Official receiver once and has heard no more from him.
He is still working and he will be discharged in November 2012.

At the other end of the scale I have had clients who have had bankruptcies approved for in excess of €50m. They to are having no hassle and will be discharged by December.

I hope this shows the type of people going bankrupt and that it is not just for the rich and super rich.

Steve

moving to UK

Hi Steve,been reading ure posts,very informative,I had a small company here in Ireland,it was ltd company,ceased trading in 2009,couldnt go into liquidation as didnt have enough money to pay liquidator,i owe bank loan €25,000,owe suppliers €7000,im on dole at moment,and no work around at all,my biggest problem is the bank loan,cause my brother in law went guarantor,i have absolutely no assets,no property,no vehicles,no savings,no wife,no kids,so im free to go to UK if i have to,cause im afraid the bank might come after my brother in law,if they cant get money from me,my brother is living in uk for many years,and i could move there,go on dole/work with him,and declare bankruptcy,do you think this would be a feasible idea.
Regards
Jamesy

One should not negate the effect of bankruptcy, although debts are discharged and the individual could accrue new debts with other creditors, in reality an individual’s credit rating means that it is extremely difficult to get significant amounts of credit in the short to medium term. The whole purpose of the UK lenient bankruptcy rules is to encourage an entrepreneurial attitude for people, allowing them to start up new businesses relatively easily and create jobs for others. It is widely known that most successful entrepreneurs will fail at least once before finally making it.

There have been a record number of bankruptcies in the UK in the last year many coming from bankruptcy tourism including Ireland. Although there may be some that will abuse the UK system, I feel there is no benefit in trapping people for years, the sooner they can become productive to the economy again the better.

Say I decide that my overall borrowings are unsustainable & Banks etc are pursuing me for recovery. I decide to move to the UK & file for bankruptcy there. 12 months elapse & I move back to Ireland & my family home which is in my wife's name. Fortunately I was generous to my wife in the couple of years prior to my insolvency & she has a couple of million put by which she kindly agrees to share with me. I recommence trading & start applying for credit. I'm back in the ball game & because I filed for Bankruptcy in the UK there is no blemish on my Irish track record.
Sounds good to me!!

Hi, this is my first time posting but I have been reading the forum for a long time. I have a question that has been on my mind about going bankrupt and I hope this does not sound too silly. My wife and I are seriously thinking of moving to UK and going bankrupt as we are down to nothing but if we go are we allowed to work and I mean in low paying jobs as we will need to work to survive and can we also declare ourselves bankrupt at the same time or are we not allowed to work while we declare bankruptcy.

2on2 said:

Hi, this is my first time posting but I have been reading the forum for a long time. I have a question that has been on my mind about going bankrupt and I hope this does not sound too silly. My wife and I are seriously thinking of moving to UK and going bankrupt as we are down to nothing but if we go are we allowed to work and I mean in low paying jobs as we will need to work to survive and can we also declare ourselves bankrupt at the same time or are we not allowed to work while we declare bankruptcy.

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I actively encourage that you work. You need to live. Also if you work it proves you have your COMI here. Good luck with whatever decision you make. I would be happy to advise you further if you wish.

Steve

Any more case studies? Would anyone who has actually gone bankrupt in the UK, like to tell their story?

Brendan Burgess said:

Any more case studies? Would anyone who has actually gone bankrupt in the UK, like to tell their story?

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That's a great idea. Those that do so should be promised that in return for their experience they won't be attacked on here for going bankrupt no matter the circumstances in return for their help in advising others.

It's a very sorry state of affairs that once again we export our problems. Alan Shatter should hang his face in shame with the shambles of a bill he is proposing.

Superannuated but want to work

Steve Thatcher said:

I actively encourage that you work. You need to live. Also if you work it proves you have your COMI here. Good luck with whatever decision you make. I would be happy to advise you further if you wish.

Steve

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Steve,
For a person from Ireland already drawing a pension of €30k nett but unable to pay huge debt/s does the pension monthly income, provided it is now to be paid into a UK bank, cause any problem particularly if I look for work a) in my own profession or b) other type as age +60 may be a barrier.
I reflect a lot of the people who posted that, although you do have a financial interest, the info you provide here is a terrific help.

conceptual said:

Steve,
For a person from Ireland already drawing a pension of €30k nett but unable to pay huge debt/s does the pension monthly income, provided it is now to be paid into a UK bank, cause any problem particularly if I look for work a) in my own profession or b) other type as age +60 may be a barrier.
I reflect a lot of the people who posted that, although you do have a financial interest, the info you provide here is a terrific help.

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I have a number of clients who are here and living on their pension. The pension is treated as income and hence there is no need to work unless you want to for sanity. You would be ok to come over and live and draw your pension and then apply for bankruptcy.

Steve Thatcher
www.stevethatcher.ie

Thanks. I will be mailing you later

[message deleted]

I have just come across a company purporting to offer a UK bankruptcy service. I don't want to mention them here as I don't want to give them publicity. The website looks very cheap and badly put together, which is always a worry to me, but what looked more odd is that nowhere on the website are there details of who is running the service and where their offices are based. They also do not provide details of who will be handling the bankruptcy in the UK and what their track record. There is no identifying information whatsoever and needless to say no media or anything about them. They have a .com address, which anyone can get, whereas the .ie domain is very well policed and proof of a CRO registered Irish company and ID are required before any .ie domain can be obtained.

However, I did some research on the Whois directory, which provides details on who owns websites, and it turns out it is being run by an auctioneers in Youghal and provides the name of the person and their address. This strikes be as a bit odd because why did they hide their name from the website? I presume this is because they are not qualified to offer a UK legal advice or assist in the procedures for a UK bankruptcy. As they are not a registered Personal Insolvency Practitioneer they are also not even qualified to provide financial advice in Ireland. I just thought this was a bit strange and it rang alarms bells with me, so I wanted to give people a heads up.

Update: I have just received a very weird non-descript email and information pack from them that contains does not contain any contact details or any indentifying details of the people in Ireland who would help me or anyone in the UK that would assist with the bankruptcy. It doesn't exactly inspire confidence in making me want to meet them.

Hi Steve
Whats a typical interview like with the Official receiver ? and what kind of documents /accounts does someone going bankrupt have to give to him ?
For instance does he examine the original mortgage application documents, look into revenue etc etc
Thanks
David

david444 said:

Hi Steve
Whats a typical interview like with the Official receiver ? and what kind of documents /accounts does someone going bankrupt have to give to him ?
For instance does he examine the original mortgage application documents, look into revenue etc etc
Thanks
David

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Hi David, the Or's interview is based upon the statement of affairs you file. He can ask to see past bank statements if he may suspect that monies have been diverted. In practice it is unlikely. He wont be bothered to to look at the mortgage contracts he will just assume that they are correct. He will check your income and outgoings to see that there is no disposable income. He won't investigate Revenue claims, he will simply ask them to fill in a proof of debt for what they owe. He will do this for every creditor.

Hope this helps

Steve Thatcher
www.stevethatcher.ie