If you are behind in debt in England and have come to the conclusion that you will not be able to pay off your debts so to declare yourself bankrupt seems like the best option, then here are important facts about bankruptcy that you should keep in mind.
That mountain of debt is right there in front of your mental window. You keep looking out at it. The more you look at that debt, the more you feel depressed and hopeless. You’ve even talked with your friends and work colleagues about it. Maybe, you haven’t discussed your financial status with your family yet.
Somehow you have come to the conclusion that declaring yourself bankrupt is your way out. You’ve given some thought to it. You’ve read about it online also. Now, this word seems stuck in your mind.
What Does Bankruptcy Mean Really?
Before you go ahead and take the next steps towards it, here are some facts that you may or may not know yet about bankruptcy.
1- Bankruptcy does have far-reaching consequences. But it is not the only option that you can consider for your debt problem. There are debt solutions like an individual voluntary arrangement (IVA) or a debt relief order (DRO) also that you should get information about from an expert debt adviser.
2- While you are bankrupt, it becomes more difficult to take out credit. Moreover, for 6 years your credit rating also gets affected.
3- If you decide to get a loan of more than £500, you need to inform your lender that you are bankrupt. Not doing so means you break the law.
4- Any house that you own may have to be sold once you are bankrupt. If you are renting a home, your landlord may decide to end your tenancy as a result of your bankruptcy.
5- Your bankruptcy may result in the closing down of your business.
6- Normally, you will get a ‘discharge’ after one year, which means your bankruptcy ends after 12 months. You don’t have to repay any debts that are covered by bankruptcy.
7- A public register will mention your bankruptcy.
You only have the option of applying for bankruptcy online after paying an amount of £680.
There are other pros and cons of bankruptcy that an expert debt adviser will walk you through in a detailed manner. He can even tell you to consider other debt solutions that could be more meaningful and helpful in your unique debt situation.
Do keep an open mind. Take a final decision on bankruptcy only after you have gone into detail about different debt solutions available to you.
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