How to Go Bankrupt may not be suitable in all circumstances. Your credit rating may be affected. Fees apply on successful applications which will be advised and built into your payment plan.
Filing for personal bankruptcy is a process that can be completed online through the Insolvency Service Portal. This process does not require a court hearing or a judge’s involvement. Instead, an Adjudicator from the Insolvency Service will determine your eligibility when looking at How to Go Bankrupt.
It’s recommended to prepare a budget before beginning your application. This budget should include your total income and monthly living expenses.
When applying, you will need to provide various documents, such as:
Other necessary expenses for maintaining a reasonable lifestyle (such as clothing, travel, parenting costs)
Debt Information
Examples of debts to declare:
Credit card balances
Unsecured loans
Unpaid council tax from previous years
Letters from enforcement agents or bailiffs
Deductions from benefits
Court fines
Any other outstanding debts (like unpaid utility bills from a previous address)
Things to Consider on How to go Bankrupt
Long-term Financial Impact: Understand the lasting effect on your credit score and financial reputation. Future loans, credit cards, and certain job opportunities may be affected.
Eligibility and Alternatives: Confirm your eligibility for bankruptcy and explore other debt relief options such as debt consolidation, negotiation with creditors, or an Individual Voluntary Arrangement (IVA).
Asset Liquidation: Be aware that bankruptcy often involves liquidating assets to pay off debts, which could include your home, car, and other valuables.
Cost of Filing: Account for the costs associated with filing for bankruptcy, including court fees and possibly attorney fees.
Impact on Creditors: Consider the effects on your creditors. Some debts, like student loans, child support, and alimony, may not be dischargeable.
Emotional and Psychological Effects: Prepare for the stressful and emotionally taxing nature of the bankruptcy process.
Public Record: Bankruptcy filings are public records, making your financial situation a matter of public knowledge.
Future Credit and Interest Rates: Post-bankruptcy, obtaining credit can be more challenging, with potentially higher interest rates.
Employment Implications: Some professions have restrictions related to bankruptcy, which could impact your current or future employment, especially in finance-related fields.
Legal Advice: Seek legal counsel to understand the full implications of bankruptcy and for assistance in the process.
Financial Management Education: Engage in financial management education post-bankruptcy to avoid future financial difficulties.
Timeframe and Discharge: Understand the duration of the bankruptcy process and the timeline for having your debts discharged.
Bankruptcy
Bankruptcy is a legally binding debt solution to resolve a debt problem that cannot be resolved. In Scotland, this is sometimes called sequestration. Consider the following before deciding how to go bankrupt.
Bankruptcy may impact your employment; therefore, you should always check the terms of your employment contract before making an application. You are also unable to be a company director unless you have permission from the court.
