Questions you have before making a decision to go Bankrupt and the Bankruptcy process

Moderators: TalbotWoods, JaneClack

By tonystrong
#472635 Hi everyone , I know i should probably be phoning payplan or a similar debt advice company to ask these questions but thought i would get a bit of an idea from here first!

I am currently on a DMP with payplan and pay £500 a month , overall debt is still around £21000 mainly credit card debt from gambling. I missed some payments and got a load of interest stuck back on a few months .

My question is would an alternative be bankruptcy ? I have no assets whatsoever , about the only thing i own in my name is a tv lol ! I am currently working self employed but am still struggling to pay back the DMP , although in all honesty i probably could but it would take forever! I would love to just have these debts gone and start a fresh .

Is bankruptcy an option and because i do work and i do have funds left over each month , would i even be accepted ?

Thanks for your thoughts.
By sally1
#472636 Hi Tony,
Of course you could apply to go bankrupt if you wish but it is a drastic step and may impact on your life for many years after you have been discharged from bankruptcy. To be honest it may well be in your best interest if you remain with your IVA if you can afford the payments. You may be able to renegotiate these if you are struggling. I suggest you discuss your options with Payplan or an alternative money advice provider e.g. CAB. Has your IVA actually failed? If not, the bankruptcy adjudicator may decide you would be better off sticking with the IVA.
Applying for Bankruptcy is an online process now, - no going to court - you will find a comprehensive guide to the new process at
There is still a fee to pay - in total £680 but you can pay in instalments. Do speak to a money adviser about your options and the pros and cons of bankruptcy before you go ahead and give up on your IVA or choose a different debt solution. Good Luck
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By JaneClack
#472637 Hello Tony

As Sally said it is a drastic step to go bankrupt and do read through the information on the link she has provided.

With a disposable income of over £20 the OR/Trustee will want an income payments arrangement and this will last for 36 months from when it is set up. However, it would be the quickest and cheapest way of resolving the debt issue but you will have to give accurate information as the OR is able to check on all kinds of things.

I see from your email that you are in a debt management plan as opposed to an IVA so if you are finding £500 a month a struggle to pay then you should ask for a review of your expenditure to work out how much you can afford exactly. At £500 if creditors froze interest and charges it would take 42 months to pay off making a DMP realistic but if your disposable income was considerably lower then you could look at an individual voluntary arrangement - Payplan do these for employed and self-employed people. Proofs would be needed of money spent and income received but then the arrangement would last for 5 years and is legally binding. You really do need to get an accurate income and expenditure done. That way you can be sure you are in the correct solution.

Please speak to your case officers and review the budget to ensure you are only paying what you can afford.