Bankruptcy information England - Going Bankrupt

A Court makes a bankruptcy order after a bankruptcy petition has been presented. It is usually presented by

  • Yourself (Debtor's Petition or Voluntary Petition for Bankruptcy)
  • Creditor/s who are owed at least £5000 by you (Creditors' Petition for Bankruptcy)

What are the benefits of going bankrupt?

Bankruptcy is not the only way of dealing with compounding personal debt, however, going bankrupt is one debt solution that allows you to,

  • Make a fresh start, subject to some restrictions.
  • Ensure that your assets are shared out fairly amongst your creditors.

Bankruptcy petitions are usually presented either at the High Court in London or a County Court near to where you live or online. A petition can be presented against you even if you are not present in England or Wales at that time, providing you normally live in or have a recent residential or business connection with, England or Wales.

When will my bankruptcy end?

A discharge from bankruptcy is the process that ends the restrictions of going bankrupt and releases you from the majority of the debts you owed at the date the bankruptcy order was made. This usually occurs after 12 months, on the first anniversary of the bankruptcy order but there may be different dates which apply to you.

The disadvantages of going Bankrupt!

  • Bankruptcy will affect for your credit rating for 6 years.
  • It costs £680 to file for bankruptcy but this can be waived or reduced in special hardship cases.
  • If you have enough disposable income, you will be asked to pay towards your bankruptcy for up to 3 years instead of the standard 12 months.
  • You may have to sell any home you own including luxury items such as expensive cars etc.
  • Pensions and savings can be affected by bankruptcy.
  • Your details will be on the public register for 12 months or 15 months or for as long as you are paying a bankruptcy order.
  • Bankruptcy can affect immigration status.
  • You may have to close any business you own / run and certain professions will not allow people to continue in employment or start for that matter once an individual has been made bankrupt.
  • Not all personal debts can be included in bankruptcy. For example (but not limited to): Secured Loans, Student Loans and Court Fines.

What should I do if I want to make myself bankrupt?

  • If you want to make yourself bankrupt you should contact your local Court or go and file online at apply for bankruptcy. They can give you the name, address and telephone number of the nearest County Court that deals with bankruptcy. It would be helpful to have a list of all your debt or creditors and this can be done by obtaining a copy of your credit report.
  • The Courts Service website has an index of County Courts.
  • Changes of the new legislation (Enterprise Act 2002) are as follows: In certain circumstances you may be discharged from bankruptcy after one year (previously the minimum was two year's).
  • A limit of three years may be placed on the Trustee's rights to realise equity in your home. (previously this was open ended).
  • Harsher penalties are imposed on those who are considered to have brought about "going bankrupt" through reckless or irresponsible behaviour. Restrictions after bankruptcy could last for a further two to fifteen years.

What if I don't agree with the bankruptcy petition?

  • A bankruptcy order can still be made even if you refuse to acknowledge or agree to the order.
  • You should try and co-operate if bankruptcy proceedings have commenced against you.
  • If you dispute the creditors' claims you should try and reach a settlement with them before the bankruptcy order is made, trying to do so afterwards can be difficult and expensive.

Going bankrupt is not an option for everyone, if you are able to afford to repay your debt, a creditor or court will recognise this and it is not advised to lie to any court or creditor as the consequences can be most serious.

The Government offers a wealth of useful information regarding debt help and bankruptcy.

For further debt consolidation help and advice regarding Bankruptcy in England please call 0800 018 6868.

Debt Management
Insolvency or IVA
Debt Consolidation
Trust Deeds
Bank Accounts