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Bankruptcy Information

Bankruptcy is a complex legal procedure and the following 10 points are intended as a brief summary of the process only and therefore do not constitute any form of professional debt advice.

Having your personal finances assessed in detail by a professional debt advisor is the first stage in deciding if bankruptcy is the only option available
If you're advised that bankruptcy is the best course of action then it's up to you to make an informed decision based on the facts
Should you choose to proceed then a bankruptcy petition will be the first stage of the process. You can either raise this yourself if you want to declare yourself bankrupt or it may be raised against you by one of your outstanding unsecured creditors
The next step is a court hearing where a decision will be made as to whether the petition should go forward into being made a bankruptcy order
Once the court has granted your bankruptcy order, they will appoint an Official Receiver who will take control of your assets such as your home
You will then be required to submit a statement of affairs within 21 days from your bankruptcy order being approved. This is simply a list of all your assets together with income and expenditure
The Official Receiver may then have to call a meeting of your creditors depending on the statement of affairs you present to them. At this meeting a Trustee in Bankruptcy may be appointed if required. They will hold your property in trust for your creditors so that they can claim what they’re entitled to or a portion thereof
Your home and other valuable assets will then usually be sold off for the benefit of your creditors
Your bankruptcy order may come with what's known as an Income Payment Order which makes you legally bound to pay an agreed monthly amount to your creditors, usually for up to 3 years
After 12 months your bankruptcy order will usually be lifted and you'll be formally discharged from it. The result of this is that your unsecured creditors will no longer be able to pursue you for any debt that was included within your bankruptcy order.

Bankruptcy can be a painful process to go through so it's critical that you're aware of the process and what's involved before you start.