Bankruptcy

Bankruptcy is not always your only way out of debt. It should only ever be considered as a very last alternative when all other debt solutions (such as an IVA or Debt Management) have been fully exhausted.

Your creditors or yourself can go to court to declare your bankruptcy. Once the order has been passed, a Trustee will deal with all of your assets, such as your home. Bankruptcy means that all of your personal possessions, such as your home, are effectively turned into cash which will go towards repaying some or all of your outstanding credit commitments to your creditors. 

It is a very public process as your details will be published in the local newspaper and online. In addition your bank accounts are closed and any hire purchases are returned.

Can I Become Debt Free With Bankruptcy?

A bankruptcy order will free you of any debt, however this comes at a price. Your finances will no longer become your own and you risk losing your assets, such as your home. 

You should always get specialist advice before you declare yourself bankrupt. If you find yourself in this serious financial difficulty, please call our freephone number on 0808 131 0039 for help and advice on alternatives.

Looking for a Debt Free alternative to Bankruptcy? Take the Debt Free Test to see your best debt solution.

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.)