Bankruptcy

Use our confidential online chat to check if bankruptcy is for you.

Who is this for?

For most, bankruptcy is the last resort to unmanageable debt. Bankruptcy could be for you if you are unable to pay anything or very little towards your debts. A 'Bankruptcy order' means your unsecured debts, interest and charges are frozen. Once the order has been put in place your assets will be dealt with by a trustee. Some assets are sold off and your creditors paid from the proceeds, subject to available funds and after payment of the costs of bankruptcy. It’s important to note that as a part of your bankruptcy, your financial situation is investigated thoroughly. You will also be subject to some restrictions for a period of time and in some cases your job might be affected.

Do I have to repay anything?

If you are able to make payments towards your debts, you will pay a monthly sum for up to three years.

Is this like an IVA?

There are similarities but it’s not the same. As with an IVA, bankruptcy gives you a fresh start. Creditors are unable to make any payment demands from you and in most cases after 12 months you will be discharged from bankruptcy. However, in bankruptcy your assets may be sold towards paying off your debts. An IVA puts you in control of your assets whereas bankruptcy does not.

So, is Bankruptcy my best solution?

Well, bankruptcy is a serious matter and is usually seen as a last resort. For some people it is the best solution, for others an IVA is a better alternative.

What are the advantages of bankruptcy?

Debts are written off (with certain exceptions, see below)
Creditors can’t take further action unless the debts are secured on your home or other property
It allows you to make a fresh start after only a year
You may be able to avoid having to sell your home if your spouse, partner or a relative can buy your share of its value after any debts secured on it have been paid

What are the disadvantages of bankruptcy?

Your bankruptcy is entered on a public register and is advertised
If you apply to the court for your own bankruptcy, you will have to pay a court fee and deposit
You will remain liable to pay certain debts – in particular student loans, fines and some debts arising from family proceedings
Any business you have will almost certainly be closed down
Your employment may be affected
Certain professionals are barred from practising if they are made bankrupt
You can’t act as a director of a company or be involved in its management unless the court agrees
You will be committing an offence if you get credit of £500 or more without disclosing that you are bankrupt
You may have a bankruptcy restrictions order made against you for 2 to 15 years if you acted irresponsibly, recklessly or dishonestly

How do I decide what’s best for me, Bankruptcy or an IVA?

Talk to us today. We’ll explain both options and we can help you through the whole process to make it as stress free as possible. Call us on 0800 0329 368 to find out how we could help you.
You can also use our Confidential Online Chat to speak to a member of our team

To read more about our fees, please click here.