Bankruptcy is a formal process usually suitable to an individual who cannot repay their debts within a reasonable period of time or have no real prospect of ever being able to do so.
If Bankruptcy is the best or only way to deal with your affairs then this can be initiated either by you or one of your creditors, who is owed in excess of £5,000.
Once a Bankruptcy Order is made the Official Receiver ("OR") will become your Trustee in Bankruptcy and take control of your assets although an external Insolvency Practitioner may subsequently take the role of Trustee. In either event, the Trustee will realise your assets and deal with your liabilities.
Bankruptcy can be seen as a process of last resort. However, in the right circumstances it can be the best way of relieving creditor pressure. Once you are made Bankrupt, your creditors will be dealt with by your Trustee in Bankruptcy and should no longer contact you in relation to their debt.
In most cases you will be discharged from Bankruptcy after one year, unlike an Individual Voluntary Arrangement which usually lasts for five years.
To discuss Bankruptcy and the alternatives please book a free, confidential, no obligation meeting by calling one of our experts at Currie Young on 01782 394500