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Debt Solutions – Bankruptcy

I am quite certain that as you read the title of this post, you were not having pleasant thoughts at all. You were probably thinking, “Why would anyone suggest bankruptcy?” Indeed, why?

I cannot emphasize enough that bankruptcy should be considered as a last resort – when all of the other possible solutions have been considered and have not worked out, then you may want to think about filing for bankruptcy. It is not an easy decision. With bankruptcy, you face social stigma, you may lose your job, your credit record will suffer horribly, and more.

Again, bankruptcy should only be considered if you have really exhausted all other options. If there is even a single option that might just work in clearing your debts, look into that first before even thinking of bankruptcy.

How does one file for bankruptcy?

The local county court is in charge of accepting bankruptcy petitions. The petitioner has to pay £450 for the fee (yes, very ironic since one is presumably stone broke already).

Once your petition has been approved, you might have to pay off your creditors from whatever income you receive. The trustee is the one who will decide this. The payments that you make are called income payments order (IPO) and they apply 3 years from the date of bankruptcy.

You might want to get help before doing anything. There are always legal professionals who hire out their services but I suggest that you contact your local CAB for free but professional advice.