How to go Bankrupt | Bankruptcy Debt Advice -
UK Wide Debt Advice Charity
Call us at 0800 085 0226
E-mail: contact@debtsupporttrust.org.uk

How Do I Go Bankrupt?

Before you do anything you must seek impartial debt advice as soon as you are aware that you have a problem repaying your creditors. You should speak to a debt advice charity like the CAB or Debt Support Trust on 0800 085 0226.

analyseyourdebt

Bankruptcy Debt Advice

When you speak to an independent advice organisation they may be able to suggest other debt solutions, like a debt management plan, IVA or Trust Deed. However if bankruptcy is the only way forward then the advisor will be able to give you the positives and negatives of the solution, including what it would mean for your job, credit file and assets.

The sooner you seek debt advice the more options that may be available to you. Bankruptcy, like many debt solutions, will negatively impact your credit file. A qualified debt advisor will be able to explain how you can become bankrupt and the fees that apply. There are costs attached to bankruptcy which you must pay so it's important you understand the process. There are two routes to enter bankruptcty.

What are the other options instead of bankruptcy?

Alternatives to Bankruptcy that you may be suitable are:

  • Informal arrangement - We could give you advice on how to negotiate with your creditors asking them to accept token payments and explaining to them that this is just a temporary situation.
  • Individual voluntary arrangement -  This is a formal arrangement between you and your creditors, when an authorised insolvency practitioner  would put a proposal  forward to your creditors that you would repay an affordable amount each month over a certain period of time and at the end of the solution any remaining amount will be written off. The insolvency practitioner would supervise the arrangement and pay the creditors in line with the proposal. The creditors would be unable to pursue you for any of the debt if you were in this arrangement.
  • Administration order - If you have a court judgment against you from one or more creditors and your total debts are £5,000 or less, then the county court could make an administration order. You would then make regular payments to the courts which they would use to pay your creditors. Whilst you are paying the administration order your creditors can take no further action against you, without first speaking to the court.

You will have to pay a fee but this will be added to your administration order and not charged separately.

  • Debt relief order (DRO) - if you cannot pay your debts, owe less than £15,000, have assets worth less than £300 and have less than £50 per month disposable income, after paying normal living expenses, you may be able to apply for a DRO. These are run by The Insolvency Service Practitioner and do not involve the courts. They are run by The Insolvency Service in partnership with skilled debt advisers, called approved intermediaries, who will help you apply to the Insolvency Service for a DRO.

We cannot stress enough to make sure you are aware of all options that are available to you before you make any decisions.

Post a comment