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Bankruptcy

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Bankruptcy

Bankruptcy is seen as the last resort. Perceived to be the only way to escape the ever-constant demands for payment by bill collectors and credit companies alike.

But bankruptcy is not something that should be rushed in to. Certainly there are times when it can be very useful, but there are other times when declaring bankruptcy would be a monumental mistake.

The constraints which are put upon you once you are declared bankrupt make it only a viable option in the most extreme of cases. It is more likely that an IVA will be the answer to severe debt problems, since it provides much of the relief offered by bankruptcy but without the severe constraints which bankruptcy imposes.

Who can become bankrupt ...
  • A debtor who is insolvent can be the subject of proceedings.

  • A person can petition their own bankruptcy.

  • Creditors can, alone or jointly, apply for a debtor to be made bankrupt where someone owes at least £750.

  • Supervisor of an IVA can apply for bankruptcy proceedings against a debtor where they have defaulted.

  • Only people normally resident in England or Wales are subject to bankruptcy law.

 

Before you make any decisions as to the suitability of declaring bankruptcy, you need to know what the Main Effects that going bankrupt will have on your current and future finances.

 

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