REDUCE DEBTS : DEBT MANAGEMENT | DEBT CONSOLIDATION | BANKRUPTCY | INFORMAL REPAYMENT PLANS | IVA | DEBT IN SCOTLAND

Bankruptcy - is it right for you?

Before you consider bankruptcy seek advice from a Debt Advisor who can make sure that you are taking the right action to get yourself out of the debt you are in.
Complete the enquiry form, an advisor will call you back and will give you help and advice, their main aim is to find the best solutions for your own personal debt problems.

What is Bankruptcy?

Bankruptcy is one solution to overwhelming debts that you will never be able to repay. Bankruptcy is the most severe result of being in serious debt. By declaring yourself bankrupt you do get protection from your creditors but there are also many negative points you should be aware of:

 

Once the bankruptcy proceedings have begun, it’s in your best interest to co-operate fully. Even if you dispute the creditors' claims it is better to try to reach a settlement before the bankruptcy order is made.

This is a formal insolvency procedure available to individuals, sole traders and individual members of a partnership. It is most suitable for individuals who have significantly high levels of debt in relation to their assets and are unable to offer reasonable payment instalments to creditors. If you can demonstrate that you are unable to pay your debts, you can present your own petition for bankruptcy. Otherwise a creditor or creditors (who are owed £750 or more), or a Supervisor of an Individual Voluntary Arrangement may raise a petition.
The period of bankruptcy is usually three years but is very much dependent on whether the debtor has co-operated with the Trustee. The Trustee in bankruptcy has legal powers to ensure the debtor contributes to the bankruptcy funds, releases equity in the matrimonial home and sells valuable assets. The laws relating to bankruptcy are complex so it is strongly advisable that you consult professional advice before taking this path.

There is an alternative way - IVA

An alternative to bankruptcy proceedings, a voluntary arrangement for an individual is a procedure whereby the person comes to an arrangement with their creditors in how their debt will be discharged. Such a scheme requires the approval of the court and is under the control of a supervisor and insolvency practitioner. An IVA means that you would avoid bankruptcy and it acts as a legally binding agreement between yourself and your creditors. You would pay back an affordable, fixed amount over a set period (usually 60 months). Your home would be protected and you would avoid any publicity.

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