Whether to file for bankruptcy or not is a difficult choice to make for anyone, and it is also one that should never be taken lightly. Bankruptcy is a very difficult situation to get out of and before you even think about it you need to seek advice from independent financial advisors who will give you the run down on your situation, plus also your alternatives to filing for bankruptcy. If you feel that you have no other choice, then the steps below will explain the procedure you need to go through.
Firstly, you need to petition the courts to begin the procedure. In order to do this you must go to your local court or the High Court in London, in person, with the relevant forms filled in. The forms you are required to present are three copies of the debtor’s petition form, and two copies of the statement of affairs form. Both forms can be found online or at your local court that deals with insolvency.
You will also be required to pay certain fees for filing for bankruptcy. These fees are a court fee of 150, an administration deposit of 450, and also if you are applying for bankruptcy at the High Court, a fee to swear the statement of affairs, which is 7. The court may waive the 150 court fee depending on your situation, for example, if you are on income support benefits. You can only pay in cash or postal orders.
Once you go to court with the correct documents and fees, the court will either hear your case immediately or arrange a future date for your petition to be heard. If your hearing goes ahead, there will be four possible outcomes. Either the hearing will be delayed until more information is obtained on your situation, the petition will be dismissed, you will be appointed an insolvency practitioner, or they will make a bankruptcy order.
An insolvency practitioner will be appointed if it is decided that an Individual Voluntary Arrangement would be a more appropriate solution. This will only happen if you have assets that are worth more than 2,000 and unsecured debts under 20,000 and you have not been declared bankrupt or filed an IVA in the preceding five years. Once you have been declared bankrupt, you will be appointed an Official Receiver, which is a court official that will deal specifically with your case. The OR will meet with you to discuss your financial situation and research your financial situation leading up to and during your bankruptcy. Two years after the bankruptcy was declared, you will be discharged and free from bankruptcy.
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Tags: Bankruptcy, business, Debt