YOURDEBTLINE
Suite 1 First Floor, 73-75 Aston Road North | Aston Cross | Birmingham | B6 4DA
Suite 1 First Floor, 73-75 Aston Road North | Aston Cross | Birmingham | B6 4DA
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Bankruptcy is considered to be the “last resort” in debt solutions. They are for people with no assets, no disposable income and no way of paying the creditors.
Bankruptcy can be competed online and it costs £680. You can complete the form yourself but it comprises of several means declaring that you are unable to repay your outstanding obligations and transferring responsibility for debt repayment to a trustee, who will either be an Official Receiver or an Insolvency Practitioner.
Bankruptcy normally lasts 12 months, after which the obligations included in the bankruptcy are discharged. You may be obliged to pay into the bankruptcy for up to three years through an income payment order if you have more than £20 in excess income each month. If your main source of income were government assistance, you are not obligated to make these payments.
Bankruptcy is only available to inhabitants of England, Northern Ireland, and Wales; Scottish citizens should look into Sequestration.
If you are failing to pay your creditors and your debts are out of control, you may file for a bankruptcy order – but there is an upfront application fee of £680. Anyone who can afford it can file for bankruptcy.
If you fail to make several payments to your creditors, they may file for bankruptcy. If you are in an IVA but fail to follow the agreed-upon terms, your IP may file for bankruptcy on your behalf.
Anyone in England, Wales, or Northern Ireland who is unable to repay their obligations may file for bankruptcy, although this option should always be explored alongside other viable debt solutions. Sequestration, the Scottish counterpart of bankruptcy, would be sought by those in Scotland.
A creditor can also apply for a debtor to be declared bankrupt if the debtor owes them at least £5,000 in unsecured debts – bankruptcy in Northern Ireland is somewhat different, and a creditor can file if you owe them more than £750 in unsecured debts.
Most people believe that declaring bankruptcy will discharge all of their obligations. This is not the case; bankruptcy does not discharge all obligations under all situations and not all debts can be included in bankruptcy. Even after being discharged from bankruptcy, you may still be responsible for some obligations. This includes any additional debts you may incur while filing for bankruptcy.
The first step in becoming bankrupt is filing for bankruptcy. Residents of England and Wales may only apply online – go here [ https://www.gov.uk/apply-for-bankruptcy ] to view the application. The application costs £680. Residents of Northern Ireland must apply through the courts; you may obtain the necessary documents to begin your application from the High Court in Belfast or the Insolvency Service.
If someone else files for bankruptcy, you will receive a copy of the petition – you can ask the court not to proceed with your bankruptcy, but you must promise the debt will be paid. Some people prefer to file for an IVA in order to protect their possessions.
Your bankruptcy will be taken up by an Official Receiver. They will interview you about your money and assets, as well as how you may contribute to your bills. You must cooperate with the official receiver and provide all necessary information.
The official receiver will take possession of your assets and may sell them to pay off your obligations. They will then decide how to divide the monies to your creditors and will use part of the proceeds for the administration procedure.
You will be permitted to keep common home things as well as any items required for employment, but property and cars may be liquidated as part of the order.
The trustee may also request you make income payments towards your debts if you can afford to do so – if you are reliant on state benefits normally you won’t be asked to make income payments.
You will be discharged from the bankruptcy order after 12 months but if you made an income payment arrangement with your trustee, you will need to carry on making payments towards.
If you decide to file for bankruptcy, you must pay £680. You can pay in instalments, but you must pay the entire sum before filing for bankruptcy. If you are having difficulty raising the bankruptcy application cost, you may be eligible to apply for a grant or get assistance from a charity.
Bankruptcy can be a great way to deal with debts you can’t pay, but it also comes with some risks.
You will often remain bankrupt for a year, after which you will be effectively debt free and ready to make a fresh start with your money
This enhance your mental and physical health, because you will no longer have to worry about repaying your obligations
You will no longer have to communicate with your creditors about your debts, and they will no longer contact you for payment. It may be a huge comfort to not have to worry about when the mail will arrive or when the phone will ring – and bankruptcy can provide this confidence.
Many people file for bankruptcy under the impression that they must give up all of their worldly goods, but this is not the case. Only your valuable things, such as your home or a high-value automobile, will be utilised to satisfy your obligations
If you are declared bankrupt, any court action taken in regard to your debts is unlikely to proceed. This includes CCJs, which are issued by the court
They will be unable to take legal action against you or pursue payment unless their debts are secured against your property
Many individuals are concerned that their partner will be affected, but they will only be affected if the debts you are declaring in bankruptcy are jointly held or if your house or other jointly owned assets must be sold
If you go bankrupt, your credit file will be affected and you may find it difficult to get any further credit, loans or a mortgage.
This implies that ownership of your property or other assets will be in the hands of the Official Receiver handling your bankruptcy
If your bankruptcy is granted, your bank accounts may be frozen to allow the Official Receiver to assess your funds. This can be an issue if you pay your bills by Direct Debit, therefore it’s a good idea to open a basic bank account that you can use for both salaries and bills.
Your home may need to be sold in order to release equity to pay your creditors. More information concerning bankruptcy and your house may be found here
Bankrupt people are not permitted to work in several sectors. These include jobs as an insolvency practitioner, financial advisor, and even in the police force or the government. If you believe you may be affected, examine your contract before filing for bankruptcy
While friends and relatives will not be able to find out about your bankruptcy unless they expressly search for it, it will be posted online in the financial newspaper The London Gazette as well as on the Insolvency Register. However, it is doubtful that it will be published in your local newspaper.
Creditors will pursue them for payment, and they will be alone responsible for what is owing. Keep in mind that this might damage a relationship and cause stress for them.
This will include the inability to borrow more than £500 in credit without informing the lender that you are bankrupt and the inability to operate a business or function as a director of a corporation without the Court’s consent
This could be extended between 2-15 years if you do not cooperate with the Official Receiver/Trustee or if your application is fraudulent.
Your Official Receiver will assess your finances, and if you have any disposable income after deducting all of your income and costs, this will need to be put into an Income Payment Agreement (IPA). This might persist up to three years.
Your Debt Line is a trading name of BCK (Birmingham) LTD. BCK (Birmingham) LTD is a company, registered in England and Wales. CO. HSE. 08263295. Registered office: Suite 1, First Floor, 73-75 Aston Road North, Aston Cross, Birmingham, B6 4DA. Data Protection Registration ZA112125. BCK (Birmingham) Limited is authorised and regulated by the Financial Conduct Authority for debt advice purposes. Our Firm Reference Number is 696156.
Alternative free-to-consumer debt services are available from the Money Helper, Step Change Debt Charity and Citizen Advice websites.