Bankruptcy
Bankruptcy Help in London
What is Bankruptcy?
Bankruptcy is a legally declared inability or impairment of ability, of an individual or organization to pay its creditors. Creditors may file a bankruptcy petition against a debtor owing over £750 - known as involuntary bankruptcy - to try and retrieve a percentage of what they are owed. The supervisor of an entered IVA can also file for bankruptcy against a debtor, if the IVA payments are not made. In the majority of cases, however, bankruptcy is initiated by the debtor - a voluntary bankruptcy - and it is voluntary bankruptcy we deal with at 1Stop Money.
Although bankruptcy has accrued many negative connotations, it is still an important option to consider when an individual is 'insolvent' - the term for someone unable to pay their debts as they fall due, and who is unlikely to be able to pay them in the future. Filing for bankruptcy effectively releases you from the pressures of creditors you have no way of paying in order to make a new financial start, with any assets being shared equally amongst your creditors.
A person going bankrupt for the first time will usually receive their discharge from bankruptcy one year after the date of the bankruptcy order, and in many cases this is considerably less. Bankruptcy should always be considered when examining insolvency cases.
What happens when I go bankrupt?
- You will lose all control of your assets - anything of particular worth that isn't considered essential for daily living, such as expensive cars, jewellery, art etc. A business or property is also considered an asset. These fall under control of a Trustee, either the Official Receiver - a civil servant and officer of the court - or a licensed Insolvency Practitioner .
- All assets will be divided equally between creditors.
- You are released from the worry of debt. NO further action can be taken against you.
- You will be unable to obtain credit for over £500 without permission from the lender
- Your bankruptcy remains on your credit file for 6 years - as does an IVA.
- Anyone can go bankrupt, but certain professions will be adversely affected, or are prohibited from continuing to practice, for the duration of your bankruptcy term. For more information speak to a 1Stop representative.
To discuss bankruptcy or any other debt solutions, please call 1Stop Money on 0800 012 4039 or fill in the online form.