The Pro’s and Con’s of bankruptcy
Bankruptcy can seem a daunting prospect, but consider the pro’s and con’s and you may come to the conclusion that actually it is a quick and painless option.
The key however is to take proper advice from an expert before taking any steps.
Advantages and Disadvantages
Some of the advantages of becoming bankrupt are:
- Your creditors have no reason to contact you again.
- You can make a fresh start after only one year, maybe less.
- Except certain narrow situations, every penny you owe is written off.
- You have a reasonable amount allowed to you to live on.
- Unless you have luxury items you will be allowed to retain your possessions
- You can operate a bank account.
- You will be able to start afresh with no debt.
- You make no further payments to anybody except maybe a sum agreed with the Official Receiver, or Trustee in Bankruptcy, for a maximum three years
- You can keep your house if you can pay the Trustee for any equity. If no equity you can have it transferred back to you for a £1.
Some of the disadvantages of bankruptcy are:
- It will cost you money up front to pay the court fees
- Whilst bankrupt you may not apply for credit of more than £500 without advising the tender you are bankrupt.
- Luxury items may be taken and sold by the Official Receiver, although we have not found anyone who has these items yet.
- Yourhome may be sold if it has equity and that equity cannot be bought out. You have up to three years to deal with the equity. Today, most houses we come across have little equity or non at all.
- If you are a company director you will have to resign.
- Your credit rating will be damaged.
- Debts under the CSA and Student Loans cannot be expunged.
You cannot be a director of a limited company.
Information provided by Steve Thatcher of Help With Debt (UK) Limited and total debt solutions company. If you have any debt problem whatsoever either personal or corporate make Steve your first call all advice is free. Finally if in the UK and you need a friend to speak to call 01162171406 Article Source:http://www.articlesbase.com/credit-articles/the-pros-and-cons-of-bankruptcy-1075662.html
For all further reading see http://www.helpwithdebtuk.com For personal contact email sthatcher@helpwithdebtuk.com
For Steve’s thoughts see http://steves-debt.blogspot.com
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