Bankruptcy – The disadvantages of bankruptcy

If you are considering voluntary bankruptc y, then you should weigh up the pros and cons of the bankruptcy process first, to decide whether or not bankruptcy is right for you.

There are a number of disadvantages of filing for bankruptcy or being decl ared bankrupt.

• It will cost you money to go bankrupt.
• Some debts, such as court fines and student loans, are never written off.
• You can’t use credit cards and bank or building society accounts.
• You can’t get credit over £500 without telling the creditor that you’re bankrupt.
• You lose control of your assets.
• Your bankruptcy will be registered with credit reference agencies.
• Your bankruptcy will remain on your credit file for up to six years.
• You will h ave to decl are your bankruptcy history under certain circumstances for the rest of you life, such as when applying for a mortgage.
• You will lose assets of real value including your home, your luxury items, any life insurance and possibly your pension.
• If you are leasing or buying an item on hire purchase, it will be returned to the owner immediately.
• Under certain circumstances, you could have a bankruptcy restriction order made against you, which can last for 15 years and restrict your financial affairs.
• Your bankruptcy can affect your immigration status
• You might be publicly examined in court.
• Your bankruptcy will be advertised in the local press and the London Gazette.
• Any business you own will be closed immediately and any employees dismissed.
• You can’t trade in any business under any other name.
• You can’t be involved a limited company without the permission of the court.
• You can’t act as a company director.
• You can’t practice as a charted accountant or lawyer.

You can’t become a member of parliament or of the local authority and you can’t act as a Justice of the peace.

It is really important that you also look into the advantages of bankruptcy and the alternatives to bankruptcy before making the decision to file for bankruptcy.

More information

• Bankruptcy – The advantages of bankruptcy
• Bankruptcy – The alternatives to bankruptcy
• Bankruptcy – What is bankruptcy?
• Bankruptcy – The bankruptcy process
• Bankruptcy – What is a certificate of summary administration?
• Bankruptcy – Voluntary and involuntary bankruptcy
• Bankruptcy – How to file for bankruptcy
• Bankruptcy – I am owed money by a bankrupt
• Bankruptcy – Insolvency and bankruptcy

Downloads

• Bankruptcy: What will happen to my home ?
• Bankruptcy: What will happen to my bank account ?
• Bankruptcy: What will happen to my pension?