Bancraptcy Advice

We offer confidential debt advice on Bancraptcy

If you are being overwhelmed by your debts to the extent that you can no longer keep up with them or if you have no money left over at the end of each month for paying off your debts after taking care of your other needs then you may need to consider filing bankruptcy.

Money Advice Direct has a team of trained consultants explain the facts in plain English to help the client make an informed decision.

What is the bankrupty process?

A Court makes a bankruptcy order only after a bankruptcy petition has been presented. It is usually presented by:

• Yourself (Debtor's Petition); or Creditors who are owed at least £750 by you (Creditors' Petition)
• A bankruptcy order can still be made even if you refuse to acknowledge or agree to the order. You should therefore try to co-operate fully once the bankruptcy proceedings have begun. If you dispute the creditors' claims you should try and reach a settlement with them before the bankruptcy order is made: trying to do so afterwards is difficult and expensive.

The below list of questions are the most commonly asked by callers to Money Advice Direct.

• Can I go bankrupt?
• What is the process of bankruptcy?
• How long will I be bankrupt for?
• Will my creditors make me bankrupt?
• How do I make myself bankrupt?
• How much does bankruptcy cost?
• What can't I do when I am bankrupt?
• What are the alternatives to bankruptcy?
• What happens to my home?
• If I go bankrupt will it affect my partner?
• Who will know I am a bankrupt?
• If I go bankrupt will it affect my partner?
• How does bankruptcy affect your credit rating?
• Will I have to go to court?
• Which court do I go to?
• What happens to my pension?

Can I go bankrupt?

Yes, anyone who is who has debt of over £750 can go bankrupt. To go bankrupt in the UK, you must live in the England, Scotland, Wales or Northern Ireland. You must also pay a fee of up to £500

What is the process of bankruptcy?

These very detailed and time consuming. The forms must be submitted to a bankruptcy court where the bankruptcy filing fees are paid.

Shortly after filing the papers you will meet with a civil servant called the “official receiver”. After this meeting you are bankrupt and provided with a dedicated bankruptcy number.

How long will I be bankrupt for?

You are actually bankrupt for 1 year. However this period can be extended if you have been uncooperative or have been acting outside the law. Please note that bankruptcy stays on your credit record for 6 years.

Will my creditors make me bankrupt?

Yes, but only as a last resort and it all depends on whether they feel they will get their money back from your assets.

 If your creditors are banks or credit card companies they will look to avoid bankruptcy because it will incur legal fees of up to £1000. If your creditors are private individuals or companies then they may be more vigilant.

How do I make myself bankrupt?

First you must complete the bankruptcy forms and then file them at court.

You have to pay the following fees:

• Court fee which is currently £150
• Administration costs are £325
• Swearing of the statement of affairs fee of £7

What can't I do when I am bankrupt?

• You lose control of your assets.
• You cannot obtain credit for over £500 without the permission from the lender.
• You cannot act as a company director.
• You cannot take any part in the promotion, formation or management of a limited company (LTD) without the permission of the court.
• You cannot trade in any business under any other name unless you inform all persons concerned of the bankruptcy.
• You may not practice as a Charted Accountant / Lawyer.
• You may not act as a Justice of the peace (JP).
• You may not become an member of parliament.
• You may not become a member of the local authority.
• Your credit is affected for many years after the annulment.
• You may be publicly examined in court.

What are the alternatives to bankrupty?

Individual Voluntary Arrangement or IVA

This is a formal and legally binding arrangement between a Debtor and their Creditors. To propose such an arrangement you will need the services of a licensed Insolvency Practitioner or IP. Call us for more information on 0800 074 6918. Proposals to creditors can be based on a lump sum offer or regular monthly payments. If 75% (in value of debt) of those creditors who vote agree, then the arrangement is legally binding on all concerned.
Regular payment IVAs normally last for between three and five years. An IVA may safeguard your property to a certain extent.

Informal Arrangements

You may be able to come to an “informal” arrangement with your creditors to repay what you owe. It can be difficult to get everyone to agree to such an arrangement.

Debt Management Plans

There are several agencies that will act on your behalf to negotiate reduced payments with your creditors.

Administration Order

If you owe less than £5,000 in total to two or more different creditors and have at least one County Court judgment against you then this Court monitored arrangement could be a good option. You will need to obtain Form N92 from your local County Court Office.

What happens to my home?

Information about your home when bankruptcy occurs. This section covers the questions you are most likely to want answered about your home if you are made bankrupt:

• Will I lose my home?
• When will the Official Receiver or trustee sell my home?
• Can anything be done to stop the Official Receiver or trustee selling my home?
• What is meant by my ‘beneficial interest’ in my home?
• What happens to my beneficial interest and legal title to my home when I am made bankrupt?
• What should be done if someone wants to buy my beneficial interest?
• Can I buy the beneficial interest if I am sole owner of the property?
• What happens if no-one buys the beneficial interest?
• What happens if I rent my home?

If I go bankrupt will it affect my partner?

No. You partner will only be affected if you have joint debts. If there are joint debts then your partner may need debt advice too.

Who will know I am a bankrupt?

You cannot keep your bankruptcy private. A list of bankrupt people is published on the internet on the “ Individual Insolvency Register”. Also, your case would be published in a local newspaper and the London Gazette publication.

How does bankruptcy affect your credit rating?

Bankruptcy, as a public record, stays on your credit file for 6 years. The banks and credit card companies use credit file information to check credit. Being a bankrupt or ex bankrupt will mean you are “sub prime” person – This means higher risk.

Will I have to go to court?

Yes, bankruptcy is a court process and you will have to be present.

Which court do I go to?

Bankruptcy petitions are usually presented in the Royal Courts of Justice at the High Court in London, Strand, England WC2A 2LL. The phone number bankruptcy office is 020 7947 6441 / 6839. The bankruptcy division is in the Thomas More building to the North of the main High Court building.

Bankruptcy can also be filed at a county court near where you live or trade (although not all deal with bankruptcy petitions).

Please click on the following link to find a bankruptcy court near your home - http://www.hmcourts-service.gov.uk/HMCSCourtFinder/

What happens to my pension?

Part or all of your pension may be claimed by your trustee in bankruptcy, whether you are receiving it now or it is due in the future.

Links to other information on bankruptcy within this site

• How will bankruptcy affect my pension?
• What type of pension do I have?
• Will I lose all my pension?
• What happens to the lump sum payable under my pension?
• What information will the official receiver and/or my trustee need?
• Should pension contributions be paid after the making of the bankruptcy order?
• Can anything be done to stop my trustee from claiming my pension?
• If my trustee has not collected my pension before my discharge from bankruptcy, will it become payable to me?

Are there any debts that aren't included in bankruptcy?

Bankruptcy writes off all unsecured debts but secured debts remain enforceable. Nearly all debts get written off in bankruptcy apart from court fines, such as speeding tickets or parking tickets.

Debts to the student loans company are not written off in bankruptcy. Debts due to the Child Support Agency (CSA) also are not included as well as Student loan debts

Common Misspellings of bankruptcy:-

• Bankrupty
• Bancraptcy
• Bancrupsty
• Bankrupcy
• Bancrupsy
• Bakruptcy
• Bankrupsy
• Bancruptcy
• Bakrupcy
• Bancrupcy
• Bancruptsy
• Bakruptsy
• Bankruptsy

Bankruptcy is still a serious undertaking, and we will always give clients the option of taking a less severe route such as debt management or an IVA if it is the best solution. Furthermore, bankruptcy is a process which suffers from a lot of stigma and misinformation.

Money Advice Direct’s team of debt advisers gives clients all the information they need to make a decision based on the facts. To speak to a member of the debt advice team please call 0800 074 6918 or apply online.

What is bankruptcy? | Bankruptcy explained | The bankruptcy process | The effects of bankruptcy | The disadvantages of bankruptcy | How do I petition for my own bankruptcy? | What happens after bankruptcy? | What are the alternatives to bankruptcy?| Can my bankruptcy be reversed? | Can my bankruptcy be cancelled? | New legislation - the Enterprise Act 2002? | Frequently asked questions | Bankruptcy additional facts | UK Personal Bankuptcy | Bankruptcy Records | Bankruptcy Advice | What happens when you visit the Official Receiver's Office? | What happens to my home in bankruptcy? | What happens to my pension in bankruptcy? | When will my bankruptcy end? | How am I made Bankrupt? | Where is the Bankruptcy Order made? | Who will deal with my bankruptcy? | Who do I need to tell if I go bankrupt? | What are your duties as a bankrupt? | What effect will Bankruptcy have on your credit rating? | Payment to your creditors in Bankruptcy | What happens to your assets in bankruptcy? | What is a bankruptcy restriction notice? | What is a form J restriction? | What happens in bankruptcy if I rent my house? | What happens to your life assurance policy in bankruptcy? | What happens to your business in bankruptcy? | What happens to your wages in bankruptcy? | What are bankruptcy restrictions orders and undertaking? | Debts you have incurred after you have been made Bankrupt | What are the advantages of going Bankrupt? | What are the disadvantages of going Bankrupt? | What are the implications of  Bankruptcy? | Jersey - a guide to Bankruptcy Law | Bankruptcy Law | Student Loans and Bankruptcy | Bankruptcy Forms | Avoid Bankruptcy | Business Bankruptcy | Accountant in Bankruptcy | Bankruptcy Lawyers | Bankruptcy Search | Bankruptcy in the UK | Declaring Bankruptcy | Filing for Bankruptcy | How to go Bankrupt | Insolvency Practitioners | Voluntary Bankruptcy | How do I avoid Bankruptcy? | Consequences of Bankruptcy | Borrowing after Bankruptcy | Bankruptcy and Student Loans | Annulling the Bankruptcy | Bankruptcy - The Court | Bankruptcy Bank Accounts | Debt Resolution Forum | Mortgage after Bankruptcy | Personal Bankuptcy | Bankruptcy Mispellings