How do you go bankrupt?



If an individual makes the decision to go bankrupt their assets will be possessed in order to pay off their debts. The assets that can be obtained by the courts include possessions, the home of the individual and the income they are earning. By choosing the go bankrupt an individual must agree with certain restrictions that will be imposed, their financial affairs will also be extensively investigated.

An individual is likely to turn to bankruptcy as the lost solution their debts that they cannot pay. The assets of the individual will be used in order to pay creditors.

Before choosing to go bankrupt individuals are advised to consider whether it is the correct way to deal with their debt problem. It is only possible to go bankrupt by a court allowing an individual to do so, the court must order a bankruptcy order against an individual. An individual can petition to the courts themselves or people who are owed money from the individual can request that they are made bankrupt. In order for creditors to make the request for somebody to made bankrupt the amount of money that is owed must exceed 750 and it must also be unsecured. By becoming bankrupt an individual can lose their home and business if they own one.

In order to go bankrupt an individual must complete several forms that will make up part of the bankruptcy petition that will be submitted. These forms are the Debtors Bankruptcy Petition and a Statement of Affairs, Debtors Petition. These forms can be collected from a local Citizens Advice Bureau or can be request by telephone from the Insolvency Enquiry Line. The forms can also be downloaded from the internet on The Insolvency Service website.

In these forms individuals are asked to list their assets including cash, property and shares; they must also list their debts. This list of debts should include the names and addresses of the creditors.

Once completed the forms should be sent off and these will be investigated by the insolvency team. In order to become bankrupt an individual must pay a fee, this can be up to 450 for the management of the bankruptcy and 150 in order to cover court costs.

An individual must contact their local bankruptcy court to arrange a date and time where their case will be heard. At this point the court will assess the case and choose the appropriate action. Each case is different and therefore the outcome will depend on the circumstances that are presented by an individual.

http://www.direct.gov.uk/en/MoneyTaxAndBenefits/ManagingDebt/Bankruptcy/DG_187323