Becoming Bankrupt?

aaroncaz

Hello, i'm new to this board, and have a few qustions abt Bankruptcy!

Sorry, im a bit dim on this subject!!

Anyway, i'd like to know, if i declare myself bankrupt, what happens to my excisting bank account/debit/credit cards?

Can you be employed, and become bankrupt?

And how long does restrictions against you last, on getting credit,bank accounts etc....

How long 'till the debt is written off, how much it costs.......as you can see, i know little abt it!!

Can anyone help?

Thanks!!

user55

Hiya, I'll try to answer this!

Your bank account will be frozen, credit cards etc obviously closed.

Yes you can be employed.

You are not allowed credit of more than £500 while bankrupt (1 year) and your credit file will be tarnished for 6 years, after which it will be a long slow process to build up a credit rating again. But then, I never want credit again so this to me is not a factor!

The day you are made bankrupt in court, you no longer have to deal with the debt, you are in fact debt free. But you may have to pay a set figure per month for the next 3 years, depending on your circumstances. That's called an IPA.

See http://www.insolvency.gov.uk/ for all the info!

fermi

aaroncaz wrote: »

Anyway, i'd like to know, if i declare myself bankrupt, what happens to my excisting bank account/debit card?

This depends upon what sort of account it is. Most normal current accounts get closed, while a 'basic' account can be left open if the 'Official Receiver' and the bank agree. It also depends on whether you owe any money to the bank the account is held with.

See this factsheet: 'What will happen to my bank account?'

http://www.insolvency.gov.uk/guidanceleaflets/bankaccount/bankaccount.htm

Can you be employed, and become bankrupt?

Yes.

And how long does restrictions against you last, on getting credit,bank accounts etc....

How long 'till the debt is written off, how much it costs.......as you can see, i know little abt it!!

Up to 12 months (sometimes less) if your case is relatively simple. However it will stay on your credit record for 6 years, which will make it difficult to get credit or a normal current account.

Currently costs £150 court fee (which you can be exempt from if you receive certain benefits).
And £335 fee for the Official Receiver, which you must pay in all cases.

In a legal sense your debt is 'written off' when you are discharged.
However, at the moment of your bankruptcy your liability to deal with you creditor ends. It is then actually illegal to make any payments to them.
Everything must be dealt with through the OR, and referred to them if a creditor contacts you.


In general some excellent sources of info are.

'Guide to Bankruptcy'
http://www.insolvency.gov.uk/guidanc...bankruptcy.htm

'How to petition for your own bankruptcy'
http://www.insolvency.gov.uk/guidanc...topetition.htm

and the whole of the Insolvency Service website has good info

especially http://www.insolvency.gov.uk/guidanceleaflets/Guides.htm

Good info on all your options is also available at:

http://www.insolvencyhelpline.co.uk/


But feel free to ask any more questions

user55

Those fees, just looked at my scribbled notes from various phone calls etc...when I rang the court to see if I needed an appointment (I do!) they told me I needed to pay £485 cash at the court. That figure doesn't add up with what Fermi has just posted, first time I've noticed that!

aaroncaz

Thank you for your replies!

My situation is, im afraid of my own making! I ran up debts of abt £7000, 3 years ago, i was working untill 05, then to make ends meet,last year, i took a loan of my bank, and now have 2 current credit cards, these are being paid monthly.
I may be starting work next week, hopefully.

But, one of the old debts has just caught up with me, yes i know i should have sorted it out 3 years ago, but i was rather overwhelmed by it all.
This debt is £3800,a credit card and i presume the other debts will catch up with me, i am now afraid that i will be unable to meet the payments i have now,plus, the debts of 3 years ago!!

I suppose i was hoping the "old debts" had forgotton abt me, silly, i know, and i could manage my new ones with bank and credit cards!!

fermi

I would also add that if you are to go BR, then you must seek professional advise. The judge will ask if you have, and may not grant the order if you have not.

You can talk to these services for free:

Consumer Credit Counselling Service (CCCS)
Tel: 0800 138 1111
http://www.cccs.co.uk/

Citizens Advice Bureau (CAB)
http://www.citizensadvice.org.uk/

Payplan
Tel: 0800 917 7823
http://www.payplan.com/

National Debtline
Tel: 0808 808 4000
http://www.nationaldebtline.co.uk

If you are having problems with your debts, it would be a good idea to speak to one of these anyway.

fermi

user55 wrote: »

Those fees, just looked at my scribbled notes from various phone calls etc...when I rang the court to see if I needed an appointment (I do!) they told me I needed to pay £485 cash at the court. That figure doesn't add up with what Fermi has just posted, first time I've noticed that!

The fees have gone up £10 compared to what it says on the IS website.
Some courts are asking for the fee, while others have not caught (or court) up yet.

I'll amend the original post to be on the safe side.

aaroncaz

Thank you Fermi, i will try these!!

[Deleted User]

How much do you earn with this new job and how much are your debts? You might still be solvent as the figures you say are fairly small. One of my friends for example earns 22K and has 180K of debt but is still fairly solvent as his dad helps him out a bit although hes working on trying his best to get to the point where he isnt solvent by partying and living for today as apparently debt is a fact of life lol, bye bye his luxury pad.

Id say if theres no way its possible to get out of debt by good planning over a 6 year period then you might as well get it written off if you dont have a house.

definatly speak with the cab

aaroncaz

No, i dont own a house, and my job, will fairly low paid, i'l be getting working tax credits, so guess i'll be on maybe £12.000? a year.

aaroncaz

whoops sorry, my old debts are abt £7.000, same as my current debts, i have a loan of £4000, which im paying £102 a month, and i owe abt £3000 on credits cards now.