Bankruptcy Advice - The Facts
Bankruptcy is often a last alternative for individuals or partnerships that cannot pay their debts. When you have been declared bankrupt your status will be made public information.
Are you considering bankruptcy?
If yes, please read the following Pros and Cons:
Pros |
Cons |
Relieves you of stress & uncertainty. |
You will lose any assets of value. |
Your creditors will be forced to accept less money than is owed. |
If you have equity on your home this will be lost |
Your debts will be written off (this excludes student loans which will still be owed). |
If you own a business this will be lost including your staff. |
Once an order has been made the responsibilities of administration & decision making will be taken over by a third party. |
If you live in rented accommodation and your rent is in arrears you could be at risk from losing your home. Bankruptcy will make it harder for you to rent again. |
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You will find it difficult to open a current account at a bank |
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You must disclose your status if you wish to order goods if you are not paying on delivery or trying to obtain credit of more than £500. |
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Your credit will be affected for many years after and you will find it very difficult to obtain future credit including getting a mortgage. |
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You will not be able to hold certain public offices such as MP, councilor or magistrate, or practice certain careers such as solicitor or accountant. You may not be a company director or hold office for a charity or pension fund. |
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Your name will be published in the local press and London Gazette and can be viewed online on the insolvency service website which is accessible worldwide. |
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Not all debts will be written off. Remaining debts will be fines, maintenance/child support payments, debts from personal injury claims and debts incurred through fraud. |
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Your financial records will be scrutinized and you will face criminal charges in court if irregularities are found. |
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Bankruptcy often comes with a stigma and may damage your reputation. |
Effects Of Bankruptcy
How will bankruptcy affect my assets?
All your assets will be sold to pay your debts. Only the property directly owned by the debtor will be at risk.
How will bankruptcy affect my future Assets?
Assets that you may receive such as an inheritance will also be a risk.
How will bankruptcy affect my future credit?
You must disclose your status when applying for any credit above 500 pounds. It is illegal not to do so. If you try to run a business you will face serious obstacles and obtaining credit may be impossible. Utility companies may insist on fitting a pre payment meter or will ask for a security deposit to minimize risk. You will be unable to become a company director by law.
How will bankruptcy affect my business/employment?
There are certain jobs you cannot have. These include lawyer, accountant, Member of Parliament or company director.
Security firms may also be reluctant to employ you due to the involvement with large amounts of money. The civil service may act in the same way.
If you own your own business which has not been forced to close then trading will be made extremely difficult. Suppliers will be unwilling to offer credit and you may suffer damage to your reputation as your bankruptcy order will be advertised locally. Trading under a different name is not allowed. Your stock may be sold by the trustee including equipment used by yourself or your staff.
How will bankruptcy affect my reputation?
Your bankruptcy order will be advertised in the local paper. The notice will invite other creditors to claim. The details will also be online on the insolvency service website.
There seems to be a stigma held about bankruptcy and it can certainly damage your reputation in general or if you have a business.
How do I become bankrupt?
You could become bankrupt in one of the following ways:
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Voluntary - By your own decision.
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Involuntarily - By a creditor who is owed at least £750.
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The supervisor - Or anyone bound by an IVA
Facing Bankruptcy? Get Free Advice & Quotes from the Bad Credit mortgage specialists:
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Fill out the simple – no obligation form
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Wait for qualified advisors to get in touch and discuss your personal circumstances.
THINK CAREFULLY BEFORE SECURING OTHER DEBTS AGAINST YOUR HOME. YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE
The actual rate will depend upon your circumstances. Ask for a personalised illustration. There will be a fee for mortgage advice. The fee will normally be 2% of the mortgage advance, minimum of £950 and a maximum of £3000.The fee can usually be added to the mortgage amount.
Enable Finance Ltd. is authorised and regulated by the Financial Services Authority for mortgages and non-investment insurance. Buy-to-Let mortgages are not normally regulated by the Financial Services Authority.
YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE