If you are struggling to deal with mounting debt problems, you may be considering filing for bankruptcy.
Although this process will help you make a fresh start clear of debt, it is not a decision you should make lightly without seeking expert legal advice.
There are a number of factors to consider and our experts can guide you through the options and help you decide whether bankruptcy, or another route such as an Individual Voluntary Arrangement (IVA), might be more appropriate for your particular needs.
Although a bankruptcy order means that most debts will be written off, certain creditors may still be able to take action to recover the money they are owed.
Our experts will examine your credit arrangements to ensure that a bankruptcy order will result in the fresh start you are hoping for.
Who can be made bankrupt?
A bankruptcy order can be made for one of three reasons:
- You can’t pay what you owe and want to declare yourself bankrupt
- Your creditors apply to make you bankrupt because you owe them £5,000 or more
- An insolvency practitioner makes you bankrupt because you’ve broken the terms of an Individual Voluntary Arrangement (IVA)
What happens when I am made bankrupt?
While a bankruptcy order is in place there are certain restrictions. You will not be able to be a director of a company or change the name of your business if you are self-employed.
You may not borrow more than £500 without informing the lender that you have a bankruptcy order in place, nor will you be able to purchase a council house under a ‘right to buy’ scheme.
What happens after bankruptcy?
A bankruptcy order typically lasts for a period of 12 months although in certain circumstances it can be extended.
After this time your bankruptcy order will be officially discharged. This means you are released from any debts covered by the bankruptcy order and restrictions will normally be lifted.
If you are considering applying for bankruptcy, please get in touch with our experts for sympathetic and impartial advice and support.