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How Do You Declare Bankruptcy In England

Register For Your Online Bankruptcy Application

How To Keep Your House While Being Made Bankrupt (UK) – Bankruptcy #2

To start to go bankrupt, you first need to create an online account.

You do this on the apply-for-bankruptcy.service.gov.uk website

At the the moment the application may not work on some mobile phones. We suggest you use a laptop or desktop if possible.

Once on the .Gov website you need to enter your name, email address and answers to three security questions you select from the dropdown menus.

It’s a good idea to write down the answers you’ve given to the security questions, as the online system will ask you one of your security questions each time you log into your application, and you won’t be able to log in if you have forgotten the answer.

Once you have entered the details you will get a message on screen confirming it has been received and that they will send you an email.

Check your email to make sure you’ve got it, then keep this email safe as it contains your bankruptcy application number.

The application number will look something like 7C4U-B3MB-EFFG you need this application number to logon to the system.

If you and your partner are both going bankrupt, there is no such thing as a “joint bankruptcy” so you will each need to follow the process above to start a bankruptcy application.

If you need help with bankruptcy then call our FREE Helpline on .

Can English Debts Be Transferred To American Debt Collectors

If you have UK debts and live abroad you can still be pursued by local debt collection agencies. We have dealt with many cases where people have filed bankruptcy from abroad due to a US debt collector contacting them to recover outstanding debts. The debt will still remain an English debt but there is nothing to stop a UK creditor using an overseas debt collection company to try to recover the money that is owed.

Many clients that have immigrated to America with debt outstanding in England have been surprised when this type of recovery action is initiated. One of the leading International Debt Recovery companies is Bluestone Law who acts on behalf of various UK creditors. Our overseas bankruptcy service will also include contacting overseas debt collection companies on your behalf and we will update them regularly as the bankruptcy progresses. If you are being contacted by an overseas debt collection company contact us for help and advice.

How To Declare Yourself Bankrupt In England

Posted 22 June 2016

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Bankruptcy can sometimes help with unmanageable debts. Find out how to declare yourself bankrupt in England.

In England, Wales and Northern Ireland, there are a number of ways you can deal with debts that have become unmanageable. Bankruptcy is one solution available in these countries, and if you live in Scotland, Sequestration is the equivalent solution.

You can become bankrupt because your creditors have made you bankrupt or because you applied for it yourself. Today were going to look at how you can make yourself bankrupt and, importantly, when its appropriate to do so.

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Where Can I Go To Get Some Debt Advice

Before deciding on bankruptcy, a process which can change your life significantly, it is important to seek some debt advice.

One source of debt advice is a credit reporting company called Experian who are widely considered to be industry experts when it comes to bankruptcy and insolvency and debt advice. The insolvency service can offer advice and support to those who are struggling financially.

You can also find an adviser at an organisation like Citizens Advice. This organisation works in your interests and its services are free. They may also have more experience breaking ideas down for the people that approach them.

Being Discharged From Bankruptcy

Bankruptcy timeline

When a debtor receives a discharge order, they are no longer legally required to pay the debts specified in the order. What’s more, any creditor listed on the discharge order cannot legally undertake any type of collection activity against the debtor once the discharge order is in force.

However, not all debts qualify to be discharged. Some of these include tax claims, anything that was not listed by the debtor, child support or alimony payments, personal injury debts, and debts to the government. In addition, any secured creditor can still enforce a lien against property owned by the debtor, provided that the lien is still valid.

Debtors do not necessarily have the right to a discharge. When a petition for bankruptcy has been filed in court, creditors receive a notice and can object if they choose to do so. If they do, they will need to file a complaint in the court before the deadline. This leads to the filing of an adversary proceeding to recover money owed or enforce a lien.

The discharge from Chapter 7 is usually granted about four months after the debtor files to petition for bankruptcy. For any other type of bankruptcy, the discharge can occur when it becomes practical.

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What Happens To Your Pension

Most pension schemes arent included in your bankruptcy and they cant be claimed by the trustee.

The pension scheme must be a UK state pension scheme or a scheme approved or registered by HM Revenue & Customs. Approved or registered pension schemes are usually:

  • occupational pension schemes approved for tax purposes
  • personal pensions approved for tax purposes
  • stakeholder pensions
  • retirement annuity contracts

If your pension scheme is not an approved or registered scheme you may be able to exclude it from your bankruptcy by:

  • applying to the court for an exclusion order, or
  • making a qualifying agreement

If your pension is part of the bankruptcy, it can be used to make payments to your creditors.

Pension Payments

Payments made to you from your pension scheme, including any lump sums, before the end of your bankruptcy can be used as part of an Income Payments Agreement or Income Payments Order . This will involve you paying some of your debt with your income.

If you are able to take money from your pension following changes to the law in April 2015, but have chosen not to do so, the trustee may look at the value of your available pension fund. If this would give you access to enough money to make a different arrangement to pay your creditors, the trustee can ask the court to cancel the bankruptcy.

Death benefits

Bankruptcies before May 2000

Can The Length Of Bankruptcy Be Extended Or Shortened

The length of Bankruptcy is 12 months in most cases. However the Official Reciver does have the power to extend this period in certain circumstances by requiring you to accept a Bankruptcy Restrictions Undertaking .

A BRU extends some of the restrictions put upon you as a bankrupt person. The extension will normally last 3 years but could be longer.

Bankruptcy cannot last for less than 12 months. Up until 2013 the Official Receiver had the power to grant early discharge. However this option was taken away in October 2013 with the introduction of the Enterprise and Regulatory Reform Act.

It is unlikely your bankruptcy will be extended with a BRU. It only happens if you do not cop-operate with the Official Receiver or have acted improperly before going bankrupt.

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A Creditor Making You Bankrupt

Your creditors can present a creditor’s petition if you owe them an unsecured debt of over £5,000. This may be the sum of two or more debts which total over £5,000. There might be different petitioning creditors on the same petition for different debts you owe.

Once bankruptcy proceedings have started, you must co-operate fully even if it’s a creditor’s petition and you dispute their claim. If possible you should try to reach a settlement before the petition’s due to be heard – doing it later can be difficult and expensive.

Debt That Can’t Be Forgiven

4 Reasons Bankruptcy May Be a Very Bad Idea

While bankruptcy can eliminate a lot of debt, it can’t wipe the slate completely clean if you have certain types of unforgivable debt. Types of debt that bankruptcy can’t eliminate include:

  • Most student loan debt .
  • Court-ordered alimony.
  • A federal tax lien for taxes owed to the U.S. government.
  • Government fines or penalties.

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Duties Of The Bankrupt To The Official Assignee

The bankrupt is obliged to:

  • unless the court otherwise directs, forthwith deliver such books of account or other papers relating to his estate in his possession or control as the Official Assignee may from time to time request and disclose to him such of them as are in the possession or control of any other person
  • deliver up possession of any part of his property which is divisible among his creditors under this Act, and which is for the time being in his possession or control
  • unless the Court otherwise directs, within the prescribed time file in the Central Office of the High Court a statement of affairs in the prescribed form and deliver a copy thereof to the OA
  • give every reasonable assistance in the administration of the estate and
  • disclose any property acquired after his adjudication in bankruptcy.
  • Important Things To Remember

    Any money you have in bank and building society accounts that you need to live on should be withdrawn from your accounts BEFORE you take your bankruptcy petition to court. This is because your accounts will be frozen once your bankruptcy petition has been taken to court. When calculating the value of your assets, you must adhere to the following guidelines:

    • You must ensure you do not falsely rise the value of any vehicles you own
    • When calculating the value of furniture and other belongings, you must set their value at what they would sell at auction not how much they were worth when new or the cost to replace them
    • Remember all such assets that you list here are open to be sold to help repay your debts

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    Objectives Of Bankruptcy Legislation

    Bankruptcy law is aimed at achieving the following.:

  • securing equality of distribution and to prevent any one creditor obtaining an unfair advantage over the others
  • protecting bankrupts from vindictive creditors by freeing them from the balance of their debts where they are unable to pay them in full, and to help to rehabilitate them
  • protecting creditors, not alone from debtors who, prior to bankruptcy, prefer one of more creditors to others, and from the actions of fraudulent bankrupts and
  • punishing fraudulent debtors.
  • How Can I Improve My Credit Rating After Bankruptcy

    Bankruptcy timeline

    As well as being public knowledge via The Gazette and the Insolvency Register, it will also impact your Credit Rating.

    • Order a statutory credit report from one of the three main credit reference agencies
    • You have the option to add a summary in your report giving a reason for going into debt . It may help by updating this
    • Update all personal details on your credit profile
    • Register for the electoral roll at your current address
    • In the longer-term, you will need to prove to lenders and borrowers that you can manage your money responsibly. You can then build up your credit profile by using and repaying credit slowly and responsibly over some time.

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    Payments From Your Income

    If you can afford it, the trustee will ask you to make regular payments towards your debts from your income through an income payment agreement . You enter an IPA voluntarily, but theres a written binding agreement between you and the trustee.

    If your main or only income is state benefits, the trustee will not normally try to get an IPA.

    If you cant agree on payment amounts for an IPA, the trustee can apply for an income payment order . If you dont meet these payments, the trustee can then apply to extend your bankruptcy.

    The payments will come from surplus income .This is money you have left after paying your living expenses. Normally you will have to pay all of this surplus income as your IPA payment.

    Payments normally last for 3 years . The court wont make an IPO if it leaves you without enough money to meet everyday needs.

    The official receiver may use private debt collection agencies to collect the payments.

    A fee will be charged in all bankruptcy cases where an IPA or IPO is set up. The fee is set at £150 which will cover the specific costs incurred by the Official Receiver of arranging and setting up your IPA / IPO and will be collected from the first payments you make into the arrangement. This fee is only chargeable on cases where a bankruptcy application was made or a petition presented on or after the 21 July 2016.

    Your Public Records On Annulment

    Youll need to check the details of the bankruptcy are removed from your credit record. If an IVA has been agreed, this will be put on your file.

    You will need to apply to both Land Charges and Land Registry to have your bankruptcy entry removed from any properties you still own after paying your debts. If you dont, the entries will remain for 5 years.

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    Who Deals With Your Bankruptcy

    An Official Receiver is appointed to protect your assets. They act as trustee of your bankruptcy affairs if you have no assets.

    If you have assets, an Insolvency Practitioner will be appointed to act as trustee and sell your assets to pay your creditors. To read more, go to:

    Once a bankruptcy order has been made against you, your creditors cannot pursue you for payment. The trustee is responsible for payments.

    Who Is Bankruptcy Suitable For

    What Actually Happens When You File For Bankruptcy

    If you have no real way of paying off your debts and few assets, then bankruptcy could be a suitable option.

    If you are a homeowner its worth looking at other options because bankruptcy puts your home at risk of being sold if there is enough equity in it.

    If youre a tenant, your landlord can apply to evict you legally if you have fallen into rent arrears.

    Its important you dont make a decision to go bankrupt alone. Talk to a free debt adviser first.

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    Next Submit Your Bankruptcy Form

    Once you have filled in the form, you will be asked to confirm a few details. Its very important you check these are correct before submitting the application. You will be asked if:

    • You agree to a credit check being performed on you.
    • All the information you have provided on the form is accurate.
    • You are the named person on the application.

    If it is later discovered you lied or provided false information knowingly which is a bankruptcy offence the restrictions placed upon you during the bankruptcy process can be extended for up to 15 years. You also risk being fined and even sent to prison in some cases.

    Check the form very carefully, ask someone you trust to help you or seek the advice of a financial expert.

    What Happens After Bankruptcy

    Normally after 12 months of a bankruptcy order being made, the bankrupt will be discharged from bankruptcy. If you were made bankrupt via the Minimal Asset Process in Scotland, you will usually be discharged from bankruptcy after 6 months. This essentially releases them from most debts and restrictions .

    Discharge from bankruptcy happens automatically. It is possible to find the discharge date on the Individual Insolvency Register , on the Register of Insolvencies , or to email the Insolvency Service and ask for a confirmation letter.

    If you are applying for a mortgage after being discharged from bankruptcy, you will require a Certificate of Discharge. In England in Wales, this is available free from the Insolvency Service or, if the bankruptcy application was made to the court, for a fee of £70 and £10 per extra copy. In Scotland, you can request a Certificate of Discharge from the AiB.

    It is necessary to apply to Land Charges and HM Land Registry to remove a bankruptcy entry in respect of properties – see GOV.UK for more information on how to apply.

    During bankruptcy, if the bankrupt does not fully cooperate with the official receiver or trustee, the court may suspend the discharge delaying it beyond 12 months.

    Any income payments agreements or income payments orders will continue beyond the discharge date. In Scotland, these orders are known as a Debtor Contribution Order and last for 48 months after discharge from bankruptcy.

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    Consider A Basic Bank Account Or Prepaid Card

    If you’re not able to open a normal bank account while you’re bankrupt, you could open a basic bank account instead, which comes without facilities like an overdraft.

    Alternatively, you could get a prepaid card. These work like credit cards, but you can only spend money you’ve already loaded onto the card, meaning they’re generally available to bankrupt customers.

    Read our guide, How to Rescue Your Finances if You’ve Been Refused a Bank Account, to learn more about options like basic bank accounts and prepaid cards.

    Have You Moved From England Or Wales To Live Abroad But Still Have Uk Debts Or Property That Are Causing You Problems

    webdesignprofessor: How Does Bankruptcy Affect You

    If the answer to this is yes, and you are now struggling with payments, you may wish to consider whether filing bankruptcy from abroad is a good solution for you.

    Dont bury your head in the sand as we are seeing more and more UK debts being transferred abroad to local debt collectors. The problem wont go away if you do nothing it will only get worse, so take positive action now. Do you really want your new life overseas spoilt by local debt collectors knocking on your door?

    As a company we feel that we have unrivaled experience and background in dealing with this specialist type of personal bankruptcy. Since 2009 we have represented almost 700 individual clients living all over the world. Their bankruptcies were handled using Power of Attorney in the High Court of London, also known as the Royal Courts of Justice. We have helped our clients to deal with their creditors, their assets and explained and clarified how this process works, both in relation to the UK and also in relation to the Country that they now live in.

    We are fully authorised by the Financial Conduct Authority to provide advice and assistance to consumers and any Company in the UK that offers this type of service should show that they are approved and licensed to do so. If they do not have FCA approval they should not be trading, let alone advising clients in relation to Insolvency & Bankruptcy.

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