London, UK -- (SBWIRE) -- 06/04/2013 -- Many people have the conception that bankruptcy is just for companies and are unaware that bankruptcy could be the right debt option for them. So what is bankruptcy? Bankruptcy is a form of insolvency and is a method for individuals who owe over £750 to be able to deal with their debts. You do not need to be a company to be able to go bankrupt. Personal bankruptcy will allow individuals to write off the money that is owed to creditors and have a fresh start.
Bankruptcy is looked upon as a final option and most people would most likely be offered debt management or an IVA before bankruptcy is explored as a solution. Bankruptcy is suitable for people with no assets, people living in rented accommodation or with family and those whose livelihood would not be affected by bankruptcy. So if that is relevant for you then bankruptcy should be explored right away and not as a last resort. If you are doing bankruptcy for the first time then you can be expect the bankruptcy to only last for 12 months maximum.
The main reason that bankruptcy is only viewed as a last resort by the majority of companies comes down to the fact of profit. For a company it is much more profitable for them if you were to take either an IVA or debt management. In an IVA the company will be paid 2 large fees called a Nominee fee and a Supervisory fee once you’re IVA has been accepted. For Debt management it is normal practice to take your first payment and a percentage of your monthly payments. There is not as much profit in Bankruptcy as there is for Debt management or an IVA.
The effects that you will feel in bankruptcy are that you will lose control of your assets if you own any. You are not allowed to obtain credit over £500 without declaring that you are currently bankrupt. You cannot take any part in the promotion, formation or management of a limited company without the permission of the courts. If you are in certain professional you may need to stop practicing, this includes company directors, accountants, solicitors, police officers, insolvency practitioner, Member of Parliament, stock broker, estate agent and pub licensee.
How do I go bankrupt? To be able to go bankrupt you need a set of documents called a bankruptcy petition and statement of affairs. These documents tell the courts details of who you owe the money to, if you have any assets, your income and expenditure and a statement of how the debt situation came around. You will need to attend your local court on a set date to hand in the documents where you will be declared bankrupt the same day.
If you have joint debts with your partner then you will need a bankruptcy petition and statement of affairs each. Although you need separate documentation you should be seen together on the same day at the courts. Clear insolvency will prepare your documentation to make sure that your bankruptcy goes through and will also prepare you for when you go to the courts. Clear insolvency will also liaise with your creditors to try stop them hassling you in the mean time until you have been made bankrupt. Once you have been made bankrupt the creditors are legally not allowed to hassle or chase you for the debt in the future. All your debts will be cleared when you go bankrupt.
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Successful Bankruptcy, We are the Bankruptcy experts and help people clear 100% of their debts through bankruptcy.
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