There are many implications of Bankruptcy, and it should be your last resort. Bankruptcy offers a fresh start to anyone in severe financial difficulty, but you should consider other options, like an IVA, first.

During bankruptcy, your assets are passed over to a Trustee. They can then be repossessed to go toward paying off your debt. There may be a better way to clear your debt such as an IVA.

What are the implications of bankruptcy?

Either you or a creditor can declare your bankruptcy. Your bankruptcy petition is then presented to a court who will rule on a bankruptcy order.

• Bankruptcy can cost up to £500 in court costs.
• Bankruptcy is a public affair and will be published in local and national newspapers.
• Unlike an IVA, assets like your home can be taken, as well as any assets acquired during your bankruptcy.
• Anything on lease will be returned, while your credit cards, store cards and bank accounts cancelled.
• If you own a business it becomes controlled by a third party and could be closed.

What doesn’t get taken in bankruptcy?

You can keep things of small value such as clothes, bedding and basic household items. Anything that you need for employment such as tools and books will not get taken. You may have to sell your car for a cheaper one too.

Bankruptcy or IVA?

The amount of bankruptcies in the UK has decreased since the IVA was introduced. Explore other debt solutions like an IVA before you pursue bankruptcy, as it could be a better option. Click to find out how to arrange an IVA and also get some confidential advice to help you clear debt.