Bankruptcy

Bankruptcy should only be considered as a last resort if you are deeply in debt. While there are situations where it can be useful, in most cases, other forms of debt management would be advisable.

When you declare bankruptcy the restrictions placed upon you are severe. The bankruptcy discharge period usually lasts for 1 year. During this time you lose control of your assets. This includes just about everything you own. Some personal possessions, household furniture, clothing, tools of the trade and certain pension entitlements are exempt.

If you own any equity in a house, this will almost certainly be sold. You will also lose any further assets you acquire during this period. All fees from the insolvency service, courts and any trustee are taken out of your assets. Bankruptcy can be very expensive, and after the bankruptcy discharge period has ended you will find it very difficult to obtain credit (e.g. a mortgage) for many years after your debts have been annulled (written off).

You typically pay less than with an IVA or Debt Management and it removes the uncertainty and stress caused by dealing with numerous creditors