If you want to apply to go bankrupt you have to submit three copies of the appropriate forms to the county court. You will also have to pay a bankruptcy fee to the courts.
The courts will only allow you to go bankrupt if you are insolvent. This means that your unsecured debts need to outweigh your assets, including property and vehicles.
Approval of new bankruptcy
Once a new bankruptcy has been approved by the court, your debts are written off and creditors cannot contact you or take legal action to recover what you owe. However, if you have assets, such as a house or car, these could be sold and the proceeds distributed to your creditors.
Bankruptcy restrictions
The term of a bankruptcy is usually 12 months. During this time there are restrictions relating to obtaining credit; you cannot borrow over £500 without declaring your circumstances to the creditor. Also bear in mind that your credit rating will be affected for six years from the date you are made bankrupt.
If you are self employed, there are also restrictions regarding doing business while you are bankrupt. You cannot promote, form or manage a limited company without the permission of the court, and you cannot trade in any business under any other name unless you inform all persons concerned with the bankruptcy.
More information
If you need more information on bankruptcy, we can provide free and impartial debt counselling. CCCS Debt Remedy, our online service, can pinpoint the best debt solution available to you.
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