Bankruptcy is the most severe debt solution currently on the market in the UK. As such, it is surrounded by a certain stigma and has a variety of significant effects on your personal finances. It’s totally understandable that you could find the prospect of bankruptcy proceedings daunting. It can go hand in hand with repossession of your home and other valuable assets, as well as having widespread impact on other aspects of your personal and professional life. Bankruptcy is a big deal but it’s not the right debt solution for everyone. After all, everyone faces different pressures and their financial situations will be personal and varied, so the solution to their problems will also be personal and should be tailored to their different circumstances.
Before going ahead with a bankruptcy petition, it’s essential that you speak to an experienced debt specialist. They will be able to advise you on the range of debt solutions available and help you to come to a decision on the best one for someone in your situation. Although it’s the UK’s most severe debt solution and it does still have a certain stigma, there’s no reason for you to be intimidated by the bankruptcy process.
After your bankruptcy term is completed, which is usually after a year, you will be discharged. Discharge from bankruptcy does not necessarily mean freedom from debt either, as it doesn’t cover all of your financial obligations. So, it doesn’t mean that unrealised assets, those are assets that didn’t go towards your bankruptcy, are guaranteed to be safe either.
So, any debt that was the result of a crime, fraud or fines won’t be included in your bankruptcy. Neither will your student load, damages, personal injury payments or child maintenance.
When you’ve successfully completed the bankruptcy term, you could still own assets that were not put towards settling your debt but are still under the control of the Trustee. They could use these assets to pay off other outstanding debts years after discharge from the bankruptcy order. It is possible that in some cases, the equity in your home or in an insurance policy can be bought out by your spouse. If they want to do this, they should get in touch with the trustee as soon as possible.
The bankruptcy order only covers debt up to the date that the order was initiated. There’s nothing to say that you couldn’t be served with another bankruptcy order while the first one’s still running, so manage your finances carefully. Remember, you face the threat of prosecution if you take on debt without disclosing your bankrupt status.
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To find out more about the after-effects of the bankruptcy process, visit www.debtsolver.co.uk and one of their dedicated debt advisors will be able to guide you through the whole procedure.
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