We receive a lot of calls from the public about, What are the advantages of going Bankrupt

Some of the implications of going bankrupt are:

• It will cost you money (up to £485) to go bankrupt
• The bankruptcy process can be embarrassing and distressing.
• Bankruptcy can effect your future.
• All assets of the debtor then vest in the Official Receiver. These assets must be realised for the benefit of your creditors.
• Bankruptcy can effect your marriage or relationship.
• Any windfall/inheritance received prior to or during the life of the bankruptcy, must be paid to the Official Receiver/Trustee in bankruptcy to contribute towards or satisfy the debts owed to your creditors. Should the windfall/inheritance exceed the amount due to your creditors, then the balance will be returned to you by the Trustee in bankruptcy.
• Whilst you are bankrupt, you can't apply for more credit
• If you own your own home, it might have to be sold (but you may be able to apply to your local authority for re-housing)
• Some of your possessions might have to be sold, for example, you will usually lose your car and any luxury items you own
• Some professions don't let people who have been made bankrupt carry on working
• If you own a business, it is more than likely that the Official Receiver will close down your business, dismiss your employees and sell off the assets.
• Going bankrupt can affect your immigration status
• You cannot keep your bankruptcy private. A list of bankrupt people is published on the internet and your case could also be published in your local newspaper
• Even when you are no longer bankrupt, you could have another order, called a bankruptcy restriction order made against you. These orders can be made, for example, where you did not co-operate with the Official Receiver, or you took on debts knowing that you had no hope of paying them back. They can last for 15 years, and will make your financial affairs very restricted.
• Even when you are no longer bankrupt, there are some debts such as court fines and student loans that will never be written off.
• There is a public stigma with bankruptcy. All people subject to bankruptcy in the UK have their name advertised in two local newspaper and the London Gazette.
• Bankruptcy can effect your ability to run a business because you cannot trade under any other name.
• You can be publicly examined in court.
• Your credit rating will be damaged for a long time, up to 6 years.
• Debts to the Student Loans Company will not be written off
• The trustee in bankruptcy may make you sell your expensive assets.
• Your professional status can be lost.
• Your job may be lost or your chances of promotion.
• The implications of a bankruptcy order are specific to the person against whom the order is made
• You can not be a director of a limited company
• You may be required to complete six monthly income and expenditure statements to determine whether you have any surplus income that could be paid to the Official Receiver in satisfaction of your debts. This is called an income payments order.

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