I’ve always had good credit and had a sensible approach to money when I was younger but as the years went by my era had the “I want now pay back later” attitude. When I was married my ex husband had a strict control over the finances and worked money out to the last pence. I used to think he was a little tight but now looking back with hindsight he was the better one with money not me! The thought of going bankrupt was never on the table then.
After splitting with my ex in 2003 I met my partner in 2004. He was totally different. He encouraged me to spend money and use my credit cards and always used to say you work so spend on yourself. I soon started to use my credit cards to the max and because I had a good credit rating I was able to apply for a personal loan to pay off the debt on the cards. I thought that this would be easy for me to control. My personal debt was but then we decided we needed to improve the house.
We had already re-mortgaged in 2005 to pay off my ex husband and put my share back in to the house!! We both had car loans and 2 credit cards each. At the time I was only working part time so my money was very tight and I had to rely on my overdraft religiously every month. My partner was also in this situation.
In 2007 we decided to get a secured loan, A VERY BIG MISTAKE!! At the time thought it was good. We were successful in applying though no surprises there!! My partner had the majority of the loan as his outgoings were allot more than mine. MY payments would be halved going down this road and the same with my partner. We would both be better off!
We had no problems meeting the mortgage and the secured loan for the first 9 months and then disaster. Due to unforeseen circumstances me and my partner split up!
We were still making the payments as required but I was concerned that as it was a joint loan my partner could stop paying his contribution, hence putting the onus on me! A part time job, 2 growing children, another credit card which I got out again!! Overdraft again!! I would not physically be able to pay the loan on top.
I took advice and as a result ended up handing keys back to the mortgage lender. I did ring the secured loan people and explained my situation but they said that we had to pay back the full amount plus interest before they would allow a house sale to go ahead!! So the keys went back and the house put on market.
The first price would mean that the mortgage would be paid off and the rest would go towards paying the secured loan off. This was in August 2008 at the same time as we went in to a country recession! The house finally sold in February 2009 and at a drastically reduced price which meant there was deficit in mortgage and no money at all to the secured loan!! I managed to arrange a payment to the building society who said that they would quite happily split the deficit 50/50 but the secured loan company wouldn’t do that. I rang this company and told them what I could afford to pay. They sent me an income and expenditure form to fill in and weren’t happy with the amount I was paying as I had a credit card which I was paying a lot more back on! To say the least they were not the nicest of people to deal with and I was getting very upset and poorly.
Luckily I had fantastic support from family and friends and in October 2009 I was declared bankrupt. The emotions on the day of the bankruptcy hearing were unbelievable, a great big hug from my dad meant the world to me!!! It still brings tears to my eyes. In June this year 2010 I received my discharge from bankruptcy. I’ve still got a payment plan in order for the next 2 and half years and my bankruptcy will be on file for the next 6 years. But do you know what it’s the best thing I’ve ever done and I am managing my finances really really well and things can and will get better!!!
