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 bankruptcy postbag for may
 Shop lease with Father as Guarantor! BR 6th May!

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T O P I C    R E V I E W
beebop Posted - 30 April 2008 : 00:36:25
3   L A T E S T    R E P L I E S    (Newest First)
melanie_giles Posted - 01 May 2008 : 00:28:07
Hope it works out for you both, and do let us know what you decide to do.

For an informal chat about any financial difficulties, or advice as to the options available, I can be contacted via my website - www.melaniegiles.com
beebop Posted - 30 April 2008 : 21:34:34
melanie_giles Posted - 30 April 2008 : 09:44:47
Hi Beebop and welcome to the forum

If your father has guaranteed the lease, then I am afraid that he is stuck with it and cannot remove himself from that liability. The terms if the lease will ascertain exactly what he is going to be liable to pay, and the Trustee in bankruptcy is most likely to disclaim it which will leave your Dad fully responsible until there can be an assignment or a surrender of same. The latter two options can only be exercised with the agreement of the landlord, and there is no way the OR is going to let you take a second job and just use the money to pay an unsecured liability - so if this is your plan I would think very carefully before you leap into the bankruptcy Court.

With regard to your stock - yes this will be taken and sold by the OR, but have you thought about holding a closing down sale as you are likely to get more money for this than if it is taken away and sold at auction. If you do this you should hold the money to the order of your eventual Trustee.

Your father's loan is an unsecured debt and therefore you will be discharged from this under the bankruptcy procedure, so it must be listed on your statement of affairs. So you will not be permitted to make any repayments to him - although in reality I am sure that you will from your allowance left with you by the OR. Your father is ultimately responsible for the debt with the bank as it is in his name. There is no such thing as being put to the top under insolvency proceedings, and indeed a lot of your other creditors would suggest that a family loan ought to be put to the bottom, although under bankrutpcy proceedings this does not happen as everyone is treated equally.

Appreciate that this is probably not what you want to hear, but hope it helps in any case.

For an informal chat about any financial difficulties, or advice as to the options available, I can be contacted via my website - www.melaniegiles.com

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