FAQs


Questions

Bankruptcy
  1. Will it cost me anything to go bankrupt?
  2. Will people know that I am a bankrupt?
  3. What will happen in court?
  4. They wont take my home if it is in negative equity/I have young children/its in my partners name, will they?
  5. What is Bankruptcy?
  6. Will I lose everything?
  7. Does Bankruptcy write off all my debts?
  8. How long will I become bankrupt for?
  9. Can you be discharged from Bankruptcy?
  10. What about my pension?
  11. Why wouldn't I declare myself Bankrupt?
  12. Can I keep my bank account?
  13. Can I still keep my job?

 


Answers

Bankruptcy
  1. Will it cost me anything to go bankrupt?

    Yes it will cost you to go bankrupt, if you petition for it yourself. You will have to pay a court fee of £150 and a deposit towards the Official Receivers costs of £355.

  2. Will people know that I am a bankrupt?

    Yes as the bankruptcy order will be advertised in your local newspaper and your details are placed within the public domain on the bankruptcy register. Anyone that you are financially connected with will also be notified.

  3. What will happen in court?

    Once your order has come to County Court, you will be given a court date which you need to attend. The court will go through your financial dealings and decide whether or not to grant you bankruptcy.

  4. They wont take my home if it is in negative equity/I have young children/its in my partners name, will they?

    Unfortunately, your Trustee has the ability to take your home, unless your partner can purchase your share of the equity. Any available equity will be passed over to your creditors.

  5. What is Bankruptcy?

    Bankruptcy is a legal process for those who can no longer afford to pay back their debts. A Bankruptcy Trustee will be assigned to sell your assets and distribute the funds accordingly. Once this process has begun, creditors can not process any further claims against you.

  6. Will I lose everything?

    As soon as the bankruptcy is declared, all your assets will become the possession of your Trustee. The only items that you will be able to keep are basic household amenities and any tools needed for your employment.

    You may lose high value assets such as jewellery, shares and any interest you have in your property. And these can be sold without your consent.

     

  7. Does Bankruptcy write off all my debts?

    Bankruptcy will clear most of your debts, there are still those which are not written off, including:

    • Debts connected with fraud.
    • Court fines, including Child support and other maintenance.
    • Secured creditors.
    • Student Loan Company debts.

  8. How long will I become bankrupt for?

    The average bankruptcy period is 12 months.

  9. Can you be discharged from Bankruptcy?

    Yes, there is a process which will release you from the bankruptcy order.

  10. What about my pension?

    Any pension payments will be considered as an income, meaning that it will be paid to your Trustee.

  11. Why wouldn't I declare myself Bankrupt?

    There are many negative consequences connected to Bankruptcy. It has a negative social stigma attached, as your details will be advertised in your local newspaper and available online.

    You will find it very difficult to get accepted for future credit or bank accounts, and certain career prospects will be closed to you.

  12. Can I keep my bank account?

    No, all of your bank accounts will be closed and any money will be used to pay your creditors. You will only be allowed to open a new bank account with the permission from your Trustee.

  13. Can I still keep my job?

    You may lose your job, but it is dependant on the sector that you are in. You will need to check your contract Terms of Employment which should provide you with more information.



ˆ Top Of Page ˆ

Entering into an IVA may adversely affect your credit rating for up to six years from the date of approval.

Your property will be protected within an IVA but you may be required to release all or part of any equity during the period of the arrangement.

Failure to complete the term of an IVA can result in bankruptcy.

(In Scotland, a PTD is the equivalent to an IVA.)
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