What will happen to me?

Call Payplan free on 0800 917 7823 or use our Debt Calculator to submit your debt problem online for free Bankruptcy advice.

The information on this page is for general guidance only. If you are considering bankruptcy or legal proceedings have been taken against you, you should seek tailored financial advice from a Payplan adviser.

Anyone can go bankrupt. You can either have a petition made against you for bankruptcy or you can apply to declare yourself bankrupt. Before deciding whether to go bankrupt or not, make sure you have considered the alternatives. Bankruptcy may not be your only option.

Bankruptcy is only one way of dealing with your debts. The advantage of bankruptcy is that you can make a fresh start with your finances, however you need to be aware of the implications of going bankrupt and the cost to yourself. Disadvantages of Bankruptcy

You will have to give up any possessions of value and any interest in your home. If you run a business it will become necessary to close that business and any employees you have will need to be dismissed.

How are you made bankrupt?

A court will only make a bankruptcy order once a petition has been presented. A petition is made either by you or by a creditor to whom you owe an unsecured debt to the value of £750 or more.

Bankruptcy is normally dealt with in the High Court in London. However, there are local courts that can deal with bankruptcy orders. Once a bankruptcy order has been made, the official receiver will give written notice of the order to a number of organisations, this will include the order being advertised in the London Gazette (an official publication containing legal notices) and your local newspaper.

Official Receivers

The Official Receiver, a civil servant in The Insolvency Service and an officer of the court will be responsible to protect your assets and for administering your bankruptcy from the date of the order. The official receiver will also act as trustee of your bankruptcy estate unless an Insolvency practitioner is appointed.

It is the responsibility of the official receiver to look into your finances prior and during the time the order is in place. They will report to the court and to your creditors. In the case of any suspected criminal offence made in connection to your bankruptcy, the official receiver will be obligated to report this also.

Insolvency Practitioners

Insolvency practitioners are individuals who specialise in insolvency work. An insolvency practitioner can be appointed as trustee instead of the Official Receiver. He or she is then responsible for disposing of your assets and making payments to your creditors.

Some Implications of Bankruptcy

Once you are made bankrupt, you will no longer be in control of your assets. The only things you may keep are items or equipment needed for work or items needed for household purposes, i.e. bedding, furniture, clothing and other basic household necessities.

All other assets will be disposed of by either the IP (Insolvency practitioner) or the OR (Official Receiver) for sale, they will use the monies to go towards the fees and costs and expenses of the bankruptcy and then your creditors.

More Information on Bankruptcy

For immediate and free debt advice please call Payplan free on 0800 917 7823 or use our Debt Calculator to submit your debt problem online.

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