April 2001
- Small Business News
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1.
NEW
SMALL
BUSINESS
SERVICE
LAUNCHED
Instant
On-Line
Invoice
Insurance
It’s
not
often
that
a
new
product
is
launched
in
the
cash
flow
industry,
however,
we
have
one
now
and
it
is
sure
to
be a
great
success
with
all
small
and
medium
size
businesses.
Coverclick.com
provide
Instant
Invoice
Insurance
that
covers
the
supplier
(you)
for
non-payment
of a
SINGLE
invoice.
The
service
is
unique
as
it
breaks
away
from
the
traditional
credit
insurance
product:
which
requires
cover
on
most
of
a
businesses
customers
as
standard.
2.
ASK
THE
EXPERT
QUESTION
&
ANSWER
QUESTION
1
Will
Past
Debts
Affect
My
Mortgage
Application
I
have
recently
gone
through
a
bad
period
financially
after
splitting
with
my
partner
last
year
(we
had
a
mortgage
together).
I
had
a
lot
of
bad
debts
which
he
left
me
with
but
thankfully
I
have
managed
to
clear
most
of
them
without
them
having
to
take
any
drastic
action.
I
only
have
2
credit
cards
now
and
I am
only
UKP150
in
arrears
on 1
and
none
on
the
other.
I
now
have
tons
of
spare
cash
and
am
looking
to
buy
a
house
(on
my
own!).
Whats
my
chances
of
getting
a
mortgage?
I
dont
have
any
CCJ's
but
because
of
the
arrears
on
my
credit
card
(which
will
be
gone
in 2
weeks)
I am
worried
that
I
have
no
chance.
No
other
web
site
seems
to
be
able
to
answer
my
question.
I am
also
worried
that
if I
try
to
apply
for
a
mortgage
and
get
refused
it
will
be
another
mark
against
my
credit
rating.
REPLY
1
Valid
concerns,
but
a
lot
more
common
than
you
may
think.
There
are
three
types
of
lenders:
A)
High
Street
-
Best
Rates.
Main
banks
&
building
societies.
B)
Off
High
Street
-
for
instance
+
0.5%
on
standard
rates.
Lesser
well
known
banks
&
building
societies.
C)
Sub
prime
-
for
instance
+
1.5%
on
standard
rates.
Specialized
finance
companies.
A
common
route
for
those
with
past
credit
problems
is
to
get
a
mortgage
with
group
'C'
and
then
switch
to
an
'A'
or
'B'
lender
after
a
couple
of
years,
once
you
have
proven
your
credibility.
Going
to
the
right
broker
is
important
as
not
many
will
themselves
provide
group
'C'
lenders,
and
you
do
not
want
too
many
negative
searches
as
you
say.
Once
completed
we
can
usually
get
the
right
broker
interested
first
time.
From
what
you
have
said
you
may
be
able
to
get
a
group
'B'
mortgage,
and
that
would
be
looked
at
first.
Basically,
all
lenders
are
re
thinking
the
way
they
do
business
with
those
who
have
experienced
debt
problems
and
good
deals
are
probably
12
months
away:
but
will
come
as
this
area
is
huge,
too
huge
to
miss
out
when
the
vast
majority
are
unlikely
to
go
back
to
troubled
times.
QUESTION
2
Will
Paying
a
Court
Order
Leave
My
Credit
Record
Clean?
I
have
a
County
Court
Judgement
against
my
name,
but
it
is
going
to
be
reversed
as I
paid
the
whole
amount
within
30
days
of
receiving
it.
Will
the
fact
that
I
have
been
that
far
down
the
bad
debt
route
affect
my
credit
record
detrimentally?
REPLY
2
It
does
depend
on
what
action
was
taken
by
the
creditor:
a)
if
they
issued
you
with
a
formal
'Default
Notice'
it
will
be
registered
for
6
years
in
your
credit
file...
b)
some
creditors
pass
monthly
payment
records
to
the
credit
reference
companies:
like,
say
Barclaycard...
…the
record
goes
like
this
'0 -
1 -
2 -
0 -
0'
which
means
that
you
paid
the
first
instalment,
fell
a
month
behind
with
the
second
payment,
then
fell
two
months
behind,
the
following
month
you
paid
the
two
arrears
payments
and
that
months
payment,
finally
you
paid
the
following
month
on
time.
c)
the
court
claim
is
unlikely
to
be
recorded
anywhere.
Requesting
your
credit
file
is
the
best
way
to
deal
with
this.
QUESTION
3 ;
Do I
have
to
Sell
My
House
to
Pay
My
Debts?
I
have
just
been
informed
that
I am
being
taken
to
court
by a
creditor
to
obtain
a
Charging
Order
against
my
property.
Until
a
search
on
the
Internet
I
had
no
idea
what
a
Charging
Order
was
and
how
it
could
be
enforced.
The
monies
outstanding
are
on
an
Unsecured
Loan.
I
have
wrote
to
my
Creditor
3
times
in
the
past
offering
monthly
terms
but
I
received
no
response.
I
would
still
like
to
be
able
to
come
to
some
form
of
monthly
agreement.
What
I
would
like
to
know
is,
if
this
Charging
Order
is
granted
will
the
Creditor
be
able
to
force
me
to
sell
my
home
rather
than
accept
monthly
payment?
Is
the
Charging
Order
able
to
be
stopped
because
they
have
failed
to
respond
to
my
letters?
and,
in
the
meantime,
should
i
try
to
contact
my
Creditor
again
to
repeat
an
offer
of
monthly
payment
?
REPLY
3
A
'charging
order
nisi'
is
the
preliminary
stage
for
securing
a
debt
on
the
sale
proceeds
of
your
house.
This
does
not
mean
that
your
house
is
to
be
sold
to
pay
off
the
debt,
but
that
when
the
house
IS
sold
the
creditor
(the
judgment
holder)
gets
paid
if
there
is
sufficient
amounts
left
after
other
charges
are
paid:
i.e.
mortgage
company,
and
possibly
your
bank.
At
this
stage
you
cannot
sell
the
property
or
secure
further
finance
through
a
charge
on
your
property.
The
second
stage
begins
with
notification
to
yourself,
and
any
other
co-owner,
of
the
nisi
and
of
the
court
and
date
for
the
creditor
to
apply
to
make
the
charging
order
absolute.
This
is
the
time
to
make
your
official
representations.
However,
trying
to
resolve
the
matter
in
the
interim
is
advisable.
Send
a
registered
letter
to
the
creditor
with
your
best
offer
of
repayment.
Inform
them
that
you
have
sent
three
previous
letters,
all
unanswered,
and
that
you
intend
to
inform
the
court
of
this:
as
such
they
have
incurred
these
costs
through
their
intransigence
and
not
through
a
lack
of
interest
on
your
part.
As
to
the
court
forcing
a
sale:
the
debt
would
have
to
be
significant,
and
your
ability
to
repay
the
debt
in a
reasonable
time-period
would
have
to
be
unrealistic.
Having
co-owners
will
normally
block
a
sale
when
its
the
family
home
and
given
that
the
creditor
has
not
answered
your
letters,
the
judge
may
throw
out
the
case
altogether.
The
creditor
has
to
make
a
separate
application
for
a
forced
sale.
With
a
successful
charge
you
can
still
use
your
house
for
security
with
charges
being
ranked
by
date
of
charge.
QUESTION
4
How
Can
I
Stop
Being
Made
Bankrupt?
I
have
an
Individual
Voluntary
Arrangement
(I.V.A.
is A
formal
payment
arrangement
with
your
creditors
Where
you
offer,
say,
20%
of
the
total
amount
of
debt
To
the
creditors)
and
I
have
missed
some
payments.
I am
paying
the
instalments
again
but
I
think
I
will
be
made
bankrupt.
I
have
been
paying
for
3
years
and
missed
the
odd
payment
before.
REPLY
4
Those
with
IVA's
tend
to
hiccup
now
and
again,
without
causing
bankruptcy:
after
all
the
idea
is
to
get
a
better
pay
out
from
the
IVA
than
from
bankruptcy.
You
should
call,
and
back
up
by
recorded
post,
the
IVA
supervisor
and
explain
the
reasons
for
the
lapses:
i.e.
home
repairs,
and
not
a
weekend
in
Paris
:))
That
said,
there
are
situations
where
bankruptcy
would
be
best
for
all
concerned:
for
instance,
where
a
debtor
was
trying
to
keep
the
family
home,
the
kids
in
private
school
and
the
two
cars,
all
on
top
of
continuing
payments
to
past
creditors
through
an
IVA
that
makes
cash
flow
scarce.
In
'general'
a
few
missed
payments
is
not
critical,
but
do
keep
the
supervisor
up
to
date
at
all
times.
3.
US
Bankruptcy
Reform
Bill
Approved
The
House
of
Representatives
on 1
March
2001
voted
in
favor
of
changing
the
legislation
covering
the
degree
of
write-off
allowed
to
debtors
in
formal
bankruptcy.
The
bill,
Bankruptcy
Abuse
Prevention
and
Consumer
Protection
Act
of
2001,
was
originally
vetoed
by
ex-President
Clinton
and
it
will
now
cause
all
debtors
to
spend
longer
periods
discharging
their
debts
and
will
also
mean
a
major
reduction
in
the
amount
of
assets
allowed
to
debtors
on
bankruptcy.
Where
the
US
goes,
the
UK
follows!
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