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Should I Declare Myself Bankrupt
Before you make any decisions about declaring bankruptcy, you should first speak to Debt Release Direct. We have bankruptcy specialists that can assess your situation and advise you whether filing for bankruptcy is the best option for you. Bankruptcy is usually considered the last option as there are disadvantages as well as benefits.
How To Declare Bankruptcy
Filing for bankruptcy can be an arduous task involving a lot of paperwork and is a legal process, therefore it must go through the courts. Our Debt Release Direct bankruptcy specialists can advise you on how to declare bankruptcy if it is decided that it is the best option for you.
Filing for bankruptcy will give you complete legal protection from your creditors and Debt Release Direct can help you through the process and even do the work on your behalf. Sometimes there are ways to regain control of your finances without having to go bankrupt which is why we would advise you to contact a debt management company like Debt Release Direct.
For advice or to find out how to declare bankruptcy, call one of our Debt Release Direct bankruptcy specialists today on 0800 019 7465.
General Bankruptcy FAQs
What is bankruptcy?
Who can go bankrupt?
How long will it take to get a bankruptcy order?
What are the costs involved with declaring myself bankrupt?
How much does it cost to go bankrupt?
How is the bankruptcy order made?
Will it be heard in open court in front of the public?
Do I have to see a judge while I am at court?
What are the usual proceedings at the bankruptcy hearing?
What happens to my affairs after the court proceeding?
What are my duties as a bankrupt person?
What kind of information will the Official Receiver ask for?
What about any money I make or given to me after being Bankrupt?
What about my bank accounts?
Can I make payments direct to the creditors?
Do I actually lose all my bank accounts and credit cards?
What happens to any money in my bank accounts?
What happens to my family home, does it form part of the Order?
Will I be kicked out of my family home?
What about my pension?
What about my life policy?
How long does the bankruptcy order last?
Is my employer informed of my bankruptcy order?
What is bankruptcy?
Bankruptcy is a way of dealing with serious debts which you cannot pay. The proceedings for bankruptcy free you from spiralling and overwhelming debts, with the outcome meaning you can make a fresh start. There might be some restrictions; and it is vital any assets are spread out equally amongst all of your creditors. Every single creditor you owe must be included in the agreement.
Who can go bankrupt?
Basically anyone can go bankrupt. This includes individual members of a partnership, but you need to be aware that there are different kinds of insolvency procedures for companies and for partnerships. To see if bankruptcy is the right option for you, try our 30 second bankruptcy test here.
How long will it take to get a bankruptcy order?
A petition for bankruptcy can be prepared with 24 hours. This is subject to you having all the information required and the funds available to complete the questionnaire. Your local county court may operate a walk in service and we might also be able to get you an appointment the very next day. A bankruptcy can be undertaken very quickly but is dependent on you being organised and prepared to move at speed.
What are the costs involved with declaring myself bankrupt?
We are very clear about our fees and charges, and our initial advice is totally free. Only when we have agreed upon the correct course of action, such as a debt management plan or bankruptcy do we know which fees are applicable. Please refer to the terms and conditions section for details.
How much does it cost to go bankrupt?
Once our fees have been paid the only fee left then is the £510 court fee (correct from 6th April 2009). This must be paid in all cases and without this payment the court will not accept your application. If you are in receipt of certain state benefits there are circumstances in which this can be reduced.
How is the bankruptcy order made?
A bankruptcy order is made at your local county court in an area in which you have lived for in the greater part of six months.
Will it be heard in open court in front of the public?
Bankruptcy is a private affair and is dealt with in closed court. You are not in a court room with a judge you are with a bankruptcy clerk. It is usual for there to be just two people in a room; you and the bankruptcy clerk.
Do I have to see a judge while I am at court?
The answer is normally no, but in some rare circumstances the judge may ask to see you. This will not be in an open court and will usually be in the chambers of the judge. The only reason for seeing a judge is for clarification purposes.
What are the usual proceedings at the bankruptcy hearing?
It is very important you arrive in plenty of time before the appointment. On arrival at the court you will have to contact the bankruptcy clerk. They will then look through the papers and will also request you to sign an oath to state that all of the information provided is true to your best knowledge and belief. The papers are then sent to the judge where he/she will look through the case. The clerk will either send you away or will ask you to wait for the answer. The waiting times do vary. After the judge makes the order you are then declared bankrupt. You will either receive a copy of the bankruptcy order there and then or this will be sent to your home address.
What happens to my affairs after the court proceeding?
Once you have been declared bankrupt your estate will be transferred to the Official Receiver who should make contact with you within 48 hours. In some cases the Official Receiver will contact you at the court. The receiver will ask you questions about any assets and bank accounts that you may have. The initial interview is usually over the telephone but in some instances they may require to see you in person. The Receiver will give the notice of the bankruptcy order to the local authorities, utility suppliers, courts, sheriffs, bailiffs, National Savings and Investments (premium bonds), the Land Registry and any relevant professional bodies. The Receiver will also make enquiries to banks; building societies; mortgage, insurance and pension companies; landlords, solicitors and basically any other persons or organisations who could provide details of any assets or liabilities that you have, or have had an interest in. Third parties will also be asked about any other matters relating to your bankruptcy.
What are my duties as a bankrupt person?
Once declared bankrupt you must comply with the Official Receivers request to provide them with information about all your financial affairs. The Receiver may even request you attend at his or her office for a formal interview. If the Official Receiver does not ask that you attend at the office for an interview, you will be sent a letter which will set out what is required of you from there onward.
What kind of information will the Official Receiver ask for?
You will more than likely be given a questionnaire to complete. You will also have to give the Receiver a complete list of all your assets and details of what you owe and to whom you owe. You must then also hand over all your bank books, records, bank statements, insurance policies and other papers relating to your property and financial affairs.
What about any money I make or given to me after being Bankrupt?
You must by law tell your trustees about any assets gained and any increases in income you obtain during your bankruptcy. This includes any properties obtained, any redundancy payments and any inheritance left to you in a will.
What about my bank accounts?
You must stop using your bank, building society, credit card and similar accounts straightaway. You must also not obtain credit of £500 or more from any person without first disclosing the fact that you are bankrupt.
Can I make payments direct to the creditors?
No. You cannot make payments direct to your creditors. All payments must go through the Official Receiver.
Do I actually lose all my bank accounts and credit cards?
This will be a commercial decision between the bank and yourself whether they trade with you.
What happens to any money in my bank accounts?
The Official Receiver will make enquiries into your bank account with a view to establishing how much money is in the account and whether or not this is vital for your everyday living expenses. You may be asked to fill in a budget planner and only then will he/she decide how much to release to you.
What happens to my family home, does it form part of the Order?
Unfortunately your home may be sold to pay off part of your debts. Whether you are the sole owner or it is in joint names, your interest in the property will form part of your bankruptcy estate. The Receiver will research the property value and also look at any loans secured on it.
Will I be kicked out of my family home?
The Receiver will halt proceedings if the property is a family home. They usually give up to a year for you to seek alternative accommodation. If the property is in joint names and only one partner in made bankrupt the home could be purchased back from the receiver from as low as £1 plus fees.
What about my pension?
Since May 2000 a pension does not normally form part of the bankruptcy. This is providing the pension is Inland Revenue approved.
What about my life policy?
The trustee in the bankruptcy may sell or surrender any policy with a value for the benefit of the creditors. You do however have an option to purchase this interest back for a nominal fee. This would have to be discussed at the Official Receivers interview.
How long does the bankruptcy order last?
Under new bankruptcy laws introduced on 1st April 2004 the statutory period for a bankruptcy was reduced from 3 years to 12 months. During these 12 months you are subject by law to the restrictions of the bankruptcy. In 2004 there was a chance for early discharge, but this is only given when there is no investigation needed further into your affairs and where you have co operated fully with the Official Receiver. This is only given at the discretion of the Official Receiver but you could be discharged after the initial 6 months.
Is my employer informed of my bankruptcy order?
In most cases your employer is not informed; but this is dependent on the kind of job you do. We would suggest you read through your employment contract or if in doubt discretely speak with the human resource manager.
