What is Bankruptcy
What is Bankruptcy
Bankruptcy is a recognised method for individuals to liquidate debts that would otherwise be impossible to repay; it releases people from overwhelming debt and allows them to restart their lives. Bankruptcy is a civil process, much like a divorce or rent dispute and does not involve standing before a Judge in open court. There are many misconceptions about bankruptcy, but the following points should put your mind at rest about this underrated debt solution:
- Bankruptcy is a civil process, much the same as a rent dispute or a divorce
- At no stage of the process does anybody visit your home
- You do not lose any household furniture or personal items in bankruptcy
- You rarely see a Judge on the day you go to court.
- Even if you did see a Judge, it would be brief and in the privacy of an office
- Your name no longer appears in local newspapers
- The Courts treat you fairly and have no interest in making money out of you (unlike IVAs which, although court sanctioned, are administered by private companies)
- In most cases, there are no monthly payments to be made
- You are allowed to keep vehicles within reason (£1,000 is the current threshold)
- You are allowed to have a bank account like everyone else in bankruptcy
What We Need To Know if we are going to help you:
1. The total amount of your debt and names / account numbers and individual amounts. Don’t be concerned if you don’t have exact amounts – the nearest £1,000 is fine as the Official Receiver writes to all parties and receives the correct figures in due course.
2. Personal details, including DOB, national insurance number, address, previous addresses, etc. We send you a questionnaire to guide you through this.
3. Details of properties owned or rented, vehicles, insurances, pensions.
4. Your general circumstances and what triggered the breakdown.
Bankruptcy is often seen as the cheapest, quickest and simplest way to clear overwhelming debt. You may not even have to go bankrupt. If we can find a way of stabilising your position and retaining control, we will point this out to you.
Bankruptcy is a debt solution for those who are insolvent i.e. they can no longer support the monthly payments for their debts. It is often seen as the fastest way out of debt. There are two ways of entering into bankruptcy and that is to either be made bankrupt by a creditor (creditor’s petition) or to apply for your own bankruptcy i.e. debtors petition.
Ever since the introduction of The Enterprise Act 2002, individuals have significantly more rights under bankruptcy and this is the main reason why bankruptcy is often more preferable to other debt solutions. As a rule, it lasts no longer than 12 months and liquidates the debt immediately, whereas alternatives drag on for anywhere between 5 and 20 years.
Feel free to call us on 01425 600129 for a chat about your circumstances.