Bankruptcy advice & help

Bankruptcy is an important solution, helping indebted clients deal with the debts they are unable to pay, having explored all other options.

Bankruptcy Advice

The bankruptcy proceedings have two of the following main objectives:

Bankruptcy is the only solution that the debtor can force their creditors to accept less than is owed to them. A bankruptcy solution has far-reaching implications on the client, it is generally viewed as a solution of last resort.

Bankruptcy

Some debtors would not be advised to petition for their own bankruptcy due to the negative impact this would have on their employment status:

This list is not exhaustive and we would always advise a debtor who is considering bankruptcy to check their contract of employment.

Debt Exclusion

Certain debts will still have to be paid by the debtor:

Marital Settlements

Unpaid Court Fines

Student Loans

Bankruptcy Costs and Fees in the UK

In England and Wales:

The application fee is £130

The bankruptcy deposit is £550

In Northern Ireland:

The Court Fee
is £127

The bankruptcy deposit is £525

There is a solicitor’s fee of £7

If you live in Northern Ireland and you’re on a low income or receive certain benefits, the court fee may be waived. Whatever your circumstances the bankruptcy deposit always has to be paid.
Once you’ve petitioned for bankruptcy, the official receiver assigned to deal with your bankruptcy will look through your finances and decide if you need to pay anything towards your debts. You may have to pay a monthly contribution towards your debts for up to three years. This is called an “income payment arrangement” or IPA. It’s payable if you have an available income of more than £20 per month after paying your household bills and essential living costs.
The official receiver won’t make you pay anything towards your bankruptcy if you can’t afford to, and they’ll always leave you with enough money to live on each month.
The debtor’s valuable items, such as property, a vehicle, expensive items of jewelry or savings, the official receiver may arrange for them to be sold, and the money generated will be used to pay back some of your debts.

Bankruptcy Costs in Scotland

In Scotland, the Accountant in Bankruptcy may order you to make a payment each month for up to four years after sequestration. This is called a “debtors contribution order” and is based on your ability to pay. You won’t be asked to pay anything after MAP bankruptcy.
For more info on Bankruptcy refer to below link from Step Change:

The Features of Bankruptcy

The Benefits For The Debtor

The Implications For The Debtor

During their bankruptcy the debtor may not:

Responsibilities of The Debtor Under Bankruptcy