What Happens & When during Bankruptcy

DRawes411

I was declared backrupt in May after being self employed for 25 years, It was my understanding that the Bankruptcy lasts for 12 months but now I am told that it will be 1+2 years? Does this mean that I will be pushed to repay the debts by the OR after the 12 months ends? I have already lost everything my home, business and family, do I really have to deal with this for 3 years and not 1?

StepChange_Aidan

DRawes411 said:

I was declared backrupt in May after being self employed for 25 years, It was my understanding that the Bankruptcy lasts for 12 months but now I am told that it will be 1+2 years? Does this mean that I will be pushed to repay the debts by the OR after the 12 months ends? I have already lost everything my home, business and family, do I really have to deal with this for 3 years and not 1?

Hi,

Thanks for your post. 

Bankruptcy usually lasts for 12 months, after which you are discharged and the restrictions no longer apply. However, the Official Receiver (OR) can extend restrictions for up to 15 years with a Bankruptcy Restrictions Undertaking/Order for if they feel that the bankruptcy was caused by dishonest or reckless behaviour.

Most debts would effectively have been written off at the point you went bankrupt, but the OR could decide to set up an Income Payment Agreement (IPA) where you be ordered to make a monthly payment for a maximum of three years. 

The IPA is worked out by the OR and would be based on what you can afford after you’ve covered your essential living costs. This would go towards making payments to your creditors and the administration costs of bankruptcy.

There’s a guide to how bankruptcy can affect you and for how long here.

I hope this helps.

Aidan 

DRawes411

Hi Aiden, thanks for your reply

sourcrates

Who has told you this ?

The very point of going bankrupct is to remove the liabilty for paying your debts, please do some research as to how this works, (in all honesty you should have done so before declaring bankrupcy) what exactly has the OR told you ?