Whilst we are still dealing with a few cases where the debtor has been made bankrupt for relatively low levels of Council Tax, it would appear that many Local Authorities are now pursuing other forms of debt recovery. Our concerns on these cases are that the Trustee in Bankruptcy’s fees are often considerable and far in excess of the original debt. It followed that people were/are losing their homes as they were unable to raise funds to pay the debts and costs of the bankruptcy and then had to be re-housed by the very people who issued bankruptcy proceedings against them in the first place.
We are also very aware of organisations who approach these debtors with offers of assistance to annul the bankruptcy, remortgage the property and generally provide the solution to the debtors situation. Sadly, every day we hear from people who have become involved with these organisations and then found that they are, at best, unable to achieve what they have offered and, at worst, put the debtor into an even more serious situation than they were at the outset. Many callers have explained to us that they charge exorbitant fees for their ‘service’ and often have a caveat in their documentation which enables them to buy the debtor’s home at a vastly reduced figure, if, for instance, the debtor is unable to remortgage his property to pay their costs/fees.
It is extremely sad that organisations such as this are welcomed by some members of the insolvency profession as ‘advisors’.