If you find that you are insolvent, meaning that you cannot afford to make repayments to your debts, Bankruptcy could be an option for you.
If you are insolvent you may find yourself asking "What Is Bankruptcy?", and it is important that you understand how Bankruptcy works as there are long term implications which cannot be avoided.
If you have any question please speak to our One Advice advisors, or take the One Advice 1 Minute Debt Test to see your other debt solutions are available to you.
A Bankruptcy Order will free you from escalating debt, giving you a fresh start (subject to restrictions) and ensure your assets are shared out fairly between your creditors. Anyone can be made bankrupt, including a business or individual members of a partnership.
Recent legislation changes regarding Bankruptcy mean that the average period of Bankruptcy usually lasts 12 months as opposed to the previous 36 months, making it seem a more attractive choice.
However, there remains many serious consequences and bankruptcy should only ever be considered as a last resort. Bankruptcy does not have to be your only option, as there are many other alternatives, such as an IVA or Debt Management.
Bankruptcy requires that the debtor must surrender any assets in order to pay off their debts. After the end of the period a debtor will be able to get a clear start, as most debts will be completely written off.
An individual or a business can be declared bankrupt voluntarily by making an application to their local County Court. Just because you are in debt doesn't mean that you should declare yourself bankrupt, there are other options, such as an IVA.
A Bankruptcy Order can also be made involuntarily through an application issued by one of your creditors, who is owed more than £750. Even if you refuse to acknowledge or agree to the proceedings it can still go ahead without your consent.
Bankruptcy means that you will have no control over your finances or how your assets are distributed between your creditors. You Bankruptcy Order will be dealt with by either:
Official Receiver or Trustee: This is a Civil Servant who acts as your on your behalf and deals with your creditors.
Insolvency Practitioner: They are a licensed professional who will be appointed instead of an Official Receiver.
One Advice have helped thousands of clients who, perhaps like you, thought that Bankruptcy was the only way to free themselves from debt.
We are on hand (via a free phone number, 0800 048 1752) to anyone that is having problems managing their debts and are looking for some friendly and professional bankruptcy advice.
Alternatively, fill in our online Enquiry Form and we will get back to you as soon as possible.