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How can we help? > Bankruptcy
Bankruptcy is a severe last resort for the seriously indebted.
Bankruptcy is one way of dealing with debts you cannot pay.
The bankruptcy proceedings free you from overwhelming debts
so you can make a fresh start, subject to some restrictions
and make sure your assets are shared out fairly among your
creditors. Anyone can go bankrupt, including individual members
of a partnership. There are different insolvency procedures
for dealing with companies and for partnerships themselves.
Becoming bankrupt has serious implications on your life and
needs to be given very careful consideration as to its implications.
Subject to certain exemptions, bankruptcy means that your
assets are sold off and the money is used to pay your creditors,
for example life insurance, pensions and you will more than
likely have to sell your home. Certain creditors are exempt
from bankruptcy proceedings i.e. student loans.
Your Bankruptcy situation is advertised in the paper and
you could have difficulty obtaining a bank account and gaining
credit. In some situations if you become a bankrupt you run
the risk of losing your job.
What are the restrictions on a bankrupt?
The following are criminal offences for an undischarged bankrupt:
- Obtaining credit of £500 or more either alone or
jointly with any other person without disclosing your bankruptcy
- Carrying on business (directly or indirectly) in a different
name from that in which you were made bankrupt;
- Being concerned (directly or indirectly) in promoting,
forming or managing a limited company, or acting as a company
director, without the courts permission, whether formally
appointed as a director or not.
You may not hold certain public offices. You may not hold
office as a trustee of a charity or a pension fund.
If during your bankruptcy the Official Receiver/Trustee who
deals with the distribution of your assets decided you have
been dishonest either before or during the bankruptcy, he/she
may apply to court for a bankruptcy order which imposes additional
restrictions for up to 15 years.
What are the Alternatives?
In some circumstances Bankruptcy may be the best option however
there are real alternatives that can help you avoid Bankruptcy.
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