Bankruptcy can help you rid yourself of debt which would otherwise take many years to repay.
It is a form of insolvency, so your unsecured debts, such as personal loans and credit card debts, need to be far greater than your assets such as property or vehicles.
If you make yourself bankrupt, your creditors write off your unsecured debts. This allows you to have a fresh start.
There is a fee to go bankrupt. The fee is £467 which is made up from £115 to the court, £7 solicitor's fees and £345 for a deposit. If you have a low income or receive benefits, you may be exempt from the court fee allowing you to go bankrupt for £352.
Bankruptcy would normally last a year and you must declare any changes to your circumstances to the Official Receiver during this period. You may also be asked to sell valuable assets, but you are able to keep most of the things you need for day-to-day living.
You cannot borrow any further credit and your credit rating is affected for a further six years.
Making yourself bankrupt is a big step to take and requires expert advice. If you are considering bankruptcy, you can use our online debt counselling service, CCCS Debt Remedy, to find out if it is the best solution for your circumstances. Alternatively contact our free Helpline on 0800 138 1111.
If, through our counselling service, you decide to go ahead with bankruptcy, our advisors will be able to help and support you. They can answer any questions you have about bankruptcy and will help you through the process.