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If you would like to discuss bankruptcy with one of our friendly debt specialists, please call 0800 520 0923 or contact us online. We will be happy to help you assess your situation and find just the right debt reduction plan.
There are five benefits to bankruptcy:
1) You will no longer be responsible for your dischargeable debts (most unsecured loans)
2) You will be discharged from bankruptcy within 1 year and all restrictions (see consequences of bankruptcy) will be lifted.
3) Monies outstanding will be written-off with the exception of student loans and non-dischargeable debt.
4) While your house and car may be at risk, you should be able to avoid losing your fridge freezer and other contents of value.
5) The court payment plan will last for 2 years, which is 3 less than an IVA.
Yes. If you have any assets they may be sold with the proceeds going to the creditors – this includes house equity. Also, any amount from your income that the insolvency practitioner deems as surplus to living expenses will be paid to your creditors.
Yes. If you owe a minimum of £750 in council tax arrears you can be made bankrupt.
No. There is a fee of £460. This pays the Official Receiver’s fee and the court costs.
Yes. Your bankruptcy will be advertised in your local newspaper and the London Gazette. Bankruptcy is a very public affair, unlike an IVA.
Your bankruptcy will be on record for six years with credit reference agencies. Lenders will be made aware of your bankruptcy whenever they consider an application for a mortgage, loan or credit card etc.
Maybe. If your car is essential for work and worth less than £3,000, you may be able to keep your car. Should it be worth more, you may be forced to sell it for another car worth less that £3,000. On sale of your car, any surplus will go to your creditor.
The 2002 Enterprise Act heralded some changes to bankruptcy law, which meant debts could be paid off in one year as opposed to three. The misconceptions about bankruptcy grew as a result, leading many people to think bankruptcy was an easy solution. The truth about bankruptcy, however, is that your insolvency will be recorded with credit reference agencies for six years, making credit almost unobtainable.
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