Bankruptcy Solicitors| Declaring Bankruptcy

Bankruptcy is one resolution for an individual to deal with a debt – or debts – that they cannot pay. It may be advised by your bankruptcy solicitors, as it is a process that ensures your assets are shared amongst your creditors appropriately.

Filing for bankruptcy allows you to make a new start free from debt, though with some restrictions applied. For a bankruptcy order to be made, one of three situations must occur:

• You cannot pay your debts and wish to declare yourself bankrupt.
• Your creditors – who you owe more than £5000 to – apply to make you bankrupt.
• Insolvency practitioners make you bankrupt due to a breach in terms of an individual voluntary arrangement (IVA).  

The Bankruptcy Process

Prior to declaring bankruptcy, you should ensure that it is the right choice for you. If you do not see any other way out of your debt problems then it may be the right choice for you, but it can have an impact on your day-to-day life. Make sure you have done your research and taken the right advice from an informed bankruptcy solicitors.

To apply for bankruptcy you simply have to fill in the form on the gov.uk website. You will need to pay a fee of £130 for the application, and then a bankruptcy deposit of £550 in England and Wales. If you do not have the money, you can pay a minimum of £5 and complete the fee in as many instalments as you may need. This is not a fee you will get back unless you cancel your application before submission.

Once the form is submitted, you must simply wait for the adjudicator’s decision – they can choose to either issue you with a bankruptcy order or reject your application. The adjudicator has a 28 day period in which to make this decision. If more information is need about your case, then the adjudicator will contact your bankruptcy solicitors for further clarification from you. This will incur a further 14 day period for them to make their decision.

Rejection can be reviewed, but if it is confirmed for the second time you will need to appeal to the court against the decision. To do so, you or your bankruptcy solicitors must submit an N1661 form to your local authority.

As soon as bankruptcy has been confirmed your money and property will officially be under the control of an official receiver. Within two weeks they will arrange an interview with you and your bankruptcy solicitors, typically over the phone, to discuss your circumstances. They will then oversee the administration of your bankruptcy by distributing your money and property to your creditors, you must co-operate fully with the receiver as they do this.

After Bankruptcy

The process of bankruptcy lasts, typically, for a period of 12 months. After this time you will be officially discharged.

During this twelve month period, you will be under a number of restrictions such as being unable to borrow more than £500 from a lender without declaring your bankruptcy, directing a company, buy a council house under the ‘right to buy’ scheme nor can you change the name of a business when self-employed. If you’re unsure whether your actions go against these limits, consult your bankruptcy solicitors before acting.

If you were declared bankrupt due to dishonest or reckless behaviour then your official receiver can extend these restrictions. This can last from anywhere between two or fifteen years.

For three months after your bankruptcy, you will also be listed on the Insolvency Register. This will include information such as your home address, date of birth, the category of your case (bankruptcy, IVA or debt relief order) and the court dealing with your case.

How can Gorvins Help?

You don’t have to go through the bankruptcy process alone. If you are considering declaring bankruptcy, then our personal insolvency and bankruptcy lawyers can guide you. Simply contact us on 0161 930 5151, e-mail disputeresolutionteam@gorvins.com or fill in our online form and a member of our expert team will call back at a time convenient to you.