Bankruptcy and credit rating

frag420

With the recent cases of various high profile people claiming bancrupcy in the UK I have a querry.
Say if someone owed the bank here some money in the region of about 20k. The loans are made up of student loan and car loan. They are not in a position to pay the loans at the rate the bank want due to various circumstances such as unemployment etc.

If this person were to move to the UK and after six months declare themselves bankrupt there what would happen to the money they owe the Irish banks. How would this affect their credit rating here in Ireland and in the UK assuming that due to previous non payment of the loan their credit rating is not good?

Cheers

frAg

tony81

After a person has been declared bankrupt it will still take at least 12 months to get out of bankruptcy. If they're making a good living I think it can be extended to 3 years.

You would not have to repay the Irish banks any more than what is agreed under the terms of the bankruptcy.

You can probably forget about taking any more loans out for years to come. It can also affect your employment prospects in the future, depending on your career.

Also, to declare bankruptcy in the UK you would need to be living over there. A job and lease would usually be enough to prove your centre of interest in now the UK.

frag420

So once that initial 12 months (or three yrs) is up does ones credit rating return to neutral?

tony81

frag420 wrote: »

So once that initial 12 months (or three yrs) is up does ones credit rating return to neutral?

No. according to this site it will be on your report in the UK for 6 years. No idea about Ireland.
http://www.piggybankrupt.co.uk/credit-repair-after-bankruptcy.html
That site has nothing to do with me and I'm not recommending them.. just the first result in google.

cookie1977

It's 5 years in Ireland as far as I know

johnfitz69

No bank would ever loan to you again in this country. Its a terrible option to go down.

frag420

So lets say if someone were to to start replaying the loan over a period of time how long before their credit rating is neutral once payment has been made in full.

In others words what would be the best option for someone in this situation who may look to get a mortgage/car loan/loan in the future?

Henry Ford III

frag420 wrote: »

So lets say if someone were to to start replaying the loan over a period of time how long before their credit rating is neutral once payment has been made in full.

In others words what would be the best option for someone in this situation who may look to get a mortgage/car loan/loan in the future?

The best option as always is to pay all debts as they fall due.

Bad debts or bankruptcy will obviosly adversely affect your ability to access credit in the future.

Talk to your lenders and see can you sort something out.

cookie1977

frag420 wrote: »

So lets say if someone were to to start replaying the loan over a period of time how long before their credit rating is neutral once payment has been made in full.

In others words what would be the best option for someone in this situation who may look to get a mortgage/car loan/loan in the future?

Might be worth speaking to a solicitor or flac

Peanut007

I know people who have done it and I'm very seriously considering it. The advice of paying debts as they fall due is laughable, if people were in a position to do this they wouldn't be staring down the barrell of the gun that is bankruptcy!!
I will keep a record of everything that transpires and report back at some stage.

cookie1977

Peanut007 wrote: »

I know people who have done it and I'm very seriously considering it. The advice of paying debts as they fall due is laughable, if people were in a position to do this they wouldn't be staring down the barrell of the gun that is bankruptcy!!
I will keep a record of everything that transpires and report back at some stage.

Before you commit to anything do explore all options (speaking to your bank, MABS, FLAC, New Beginning etc....) What every way you do end up going it will be tough. Really, best of luck of will of this.

BuffyBot

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