Declaring Bankruptcy

Bankruptcy should be considered as a last resort

Declaring bankruptcy is an option that often has to be considered when an individual cannot pay their debts as they fall due. A first time bankrupt with debts will generally receive their discharge one year after the date of the bankruptcy order. In the UK declaring bankruptcy should be considered as a last resort after considering an IVA or a Debt Management Programme.

Although declaring bankruptcy has a bad stigma and is publicly advertised, it should always be considered when dealing with individual insolvency cases. The UK Insolvency Helpline advise reading the following frequently asked questions before making the important decision of declaring bankruptcy.

Declaring Bankruptcy – The advantages

• Creditors can no longer pursue you for the debts after declaring bankruptcy
• Pressure is taken off you because you don't have to deal with your creditors.
• You are allowed to keep certain things, like household goods and a reasonable amount to live on
• When the bankruptcy order is over, you can make a fresh start. In many cases, this can be after only one year
• The money you owe can usually be written off.
• Creditors have to stop most types of court action back following a bankruptcy order (but in some still be able to take your belongings away)
• Most creditors have to stop chasing you for the debt and make their claim to the trustee instead;
• It’s a chance to make a fresh start.
• You don't have to personally deal with creditors
• You can keep some household goods and a reasonable amount to live on

14 Important questions on declaring bankruptcy.

1. What is declaring bankruptcy?
2. The process if declaring bankruptcy.
3. The effects of declaring bankruptcy
4. The disadvantages of declaring bankruptcy
5. What happens after declaring bankruptcy?
6. What are the alternatives to declaring bankruptcy?
7. What happens when you visit the Official Receiver's Office after declaring bankruptcy?
8. What happens to my home after declaring bankruptcy?
9. What happens to my pension after declaring bankruptcy?
10. What effect will declaring Bankruptcy have on your credit rating?
11. Debts you have incurred after you have been declared bankrupt
12. What are the advantages of declaring Bankruptcy?
13. What are the disadvantages of declaring Bankruptcy?
14. What are the implications of declaring Bankruptcy?

If you would like any further information and advice about declaring bankruptcy in the UK and the possible alternatives of declaring bankruptcy, please contact Money Advice Direct bankruptcy team on 0800 074 6918. The service can advise on all aspects of bankruptcy law including the Disadvantages of Bankruptcy, How to File for Bankruptcy, How to Avoid Bankruptcy and the Effects of Bankruptcy.

back to top

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