Irwin & Company,
Someone you owe money to (a creditor) can apply to make you bankrupt but must be owed at least £5,000 to do so.
However, If you have a debt problem you can apply for your own bankruptcy online. Your application will be considered by an adjudicator, this being someone who works for the Insolvency Service, who will decide if you should be made bankrupt.
A fee of £680 will be payable to make yourself bankrupt online which can be made in installments, but your application will not be processed until payment has been received in full.
Within 28 days of submitting your application, you should receive notification from the adjudicator advising if you have been made bankrupt. If so a bankruptcy order will then be issued.
The Official Receiver becomes the receiver and manager of the bankruptcy estate following the order. In some cases, the Official Receiver may pass the management of your case over to a licensed insolvency practitioner.
You will be completely cleared of many debts but not damages for personal injuries; family liabilities, such as maintenance arrears; liabilities under criminal law, such as fines or frauds; student loans; and some benefits among others.
You can be discharged in as little as a year but if you have previously been made bankrupt then discharge could take longer.
You might not have to make any payments unless an income payment order is made.
Declaring bankruptcy is one way to remove your debts, but it can be a complicated process with lasting consequences.
Declaring bankruptcy can only be done on a personal level, when an individual can’t pay their debts and needs a way out. It’s essentially a fresh financial start, but it’s not quite as simple as just wiping the slate clean.
Bankruptcy can result in negative consequences for years to come, as well as costs and debt repayments. Bankruptcy can also result in the loss of important assets, such as personal businesses, cars and even homes.
It’s not to be taken lightly, and bankruptcy isn’t for everyone. Not all debts can be eliminated, so it’s best to speak with legal advisors before filing for bankruptcy.
At Irwin Insolvency, we can help you to decide if declaring bankruptcy is the best financial option for you.
Declaring bankruptcy can be a good solution when it comes to clearing personal debts, but always remember that there are both short-term and long-term costs that still need to be considered.
One of the immediate consequences of declaring bankruptcy is payment. Although declaring bankruptcy is only for those in desperate financial straits, it actually costs money to do so.
The upfront cost of applying for bankruptcy online is £680. While this might not seem like a huge sum of money at the outset, if you’re already burdened with huge debts that you need to pay off, it’s not always an easy sum of money to raise.
This upfront cost can be a hardship and it can, of course, be added to outstanding debts that you might still need to repay, even after you’ve applied for bankruptcy. If you’re applying for bankruptcy, it is possible to pay off this initial fee in instalments, thereby limiting the overall damage to your personal funds or income.
You can set up a payment plan, paying the fee off in parts. What you need to take into account though, is that when paying in instalments, you can still only declare bankruptcy officially once the entire payment has been paid. If you are in urgent need of declaring bankruptcy, this can be a problem, so you may need to borrow or raise the funds quickly rather than pay in instalments.
To be certain that declaring bankruptcy is the correct route for you financially, then it’s also best investing in expert advice. While this might be an extra financial hardship in the short term it will help you in the long run. Our experts at Irwin Insolvency might even be able to advise you on ways to avoid bankruptcy, thereby saving you on huge costs in the long run. Either way, it’s a cost that’s worth paying, as nothing beats excellent financial and legal advice.
A common myth when it comes to declaring bankruptcy is that you’re instantly wiped clean of your debts. That is, unfortunately, a myth. Even after declaring bankruptcy, you will have other debts and costs to factor into your financial planning to get you back on the right financial path again.
Many debts aren’t covered, including student loans and family finances such as child support. You will still need to pay these, and you will also need to repay certain debts over time that you owe your debtors.
There are also other costs you need to think of too, as bankruptcy can lead to a loss of your personal business, your car and even your home.
All these costs need to be factored into the planning if you are thinking of declaring bankruptcy.
Bankruptcy isn’t always the right solution for clearing personal debts, and declaring bankruptcy ultimately comes down to your personal, financial situation.
While bankruptcy is best for certain financial situations, there are other alternatives out there, some of which you might not be aware. Always consider the other options before declaring bankruptcy.
One of the best alternatives is a simple debt management plan, which will avoid you getting further into debt. This essentially involves an outside company examining your finances and setting up a repayment plan that works for you and your debtors. This only works if you have a steady and stable income, and can predict your financial income and outgoings consistently.
Administration orders are another option, although these are usually instigated by a debtor looking to recover the money that’s owed to them by an individual. An administration order will cut any further interest payments, but can only be ordered if the debt is £5,000 or less.
Debt consolidation loans are another method to sort out your debts, as they allow you to take out one loan to pay off all your existing debts. You then have a simpler repayment plan and less interest to pay off.
An individual voluntary arrangement (IVA) is one of the alternatives to bankruptcy. This requires the help of insolvency specialists, and the agreement of the majority of the debtors who are owed money. This becomes a legally binding agreement whereby you voluntarily repay the money you owe over time to your debtors. This is a good way to avoid bankruptcy and to secure a solid repayment plan, but again, you will need a steady income to get the different debtors to agree to the payment plan, as they’ll need security to get this passed legally by the courts.
Before deciding what path is best for you, it’s always best to talk to an expert. At Irwin Insolvency, we have years of experience dealing with bankruptcy and advising on other alternatives. We can help you to find the best solution for your financial problems.
Declaring bankruptcy can be the best way to clear your debts and to have a fresh start, but there are alternatives too. Our bankruptcy experts are ready to share their knowledge with you. Contact Irwin Insolvency today to find out more. Call 0800 009 3173 for your free, no obligation consultation.