Bankruptcy

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Info on Personal Bankruptcy

Applying for bankruptcy is not something to be taken lightly. It takes a lot of guts to face up to your debt problems and tackle them head on. If you carefully weigh up all of the alternatives, consider the other potential courses of action and fully understand the consequences, bankruptcy could be a really positive step towards a new, debt free beginning.

Harrington Brooks can offer you good, practical advice on whether bankruptcy is a worthy, or indeed your best option. Talk to one of our expert advisors today on 0800 0481 764.

If you are unable to meet the repayments on your loans and feel the mounting pressure of unserviceable debt, you could be able to file for personal bankruptcy. Your creditors would certainly prefer that you seek out alternatives to bankruptcy, as they don't gain very much from it. They would rather that you went down the route of an Individual Voluntary Arrangement or another debt solution that caters for the reduced but ongoing service of your debt. It would definitely be worth giving serious consideration to the alternatives as you may find that your creditors are willing to offer support, in addition to the close support and guidance offered by Harrington Brooks, that saves you from the consequences of filing for bankruptcy.

Once again, it is absolutely essential that you confront your debt problems early and don't leave it to snowball out of control. Harrington Brooks are here to provide you with any advice and support you may require. Not only that but we can deliver the added peace of mind that comes from knowing that we will do everything in power to help you solve your debt problem in a manner that suits you.

At Harrington Brooks, we are continually striving to offer our clients the best possible advice, tailored to suit your specific debt problem and focus on the task of getting you into a situation where you can afford to make repayments and resolve your debt problems as quickly as possible. To speak to one of expert Harrington Brooks advisors, just call us today on 0800 0481 764 and take the first step towards a debt free future.

For the vast majority of people, the personal bankruptcy term lasts no more than 12 months. It's even possible to discharge from bankruptcy proceedings after 6 months. If you're bankrupt, you may not apply for credit any credit that's greater than £500 without making a declaration of your financial status. You should also inform any business partners and creditors that you are bankrupt too; if you don't, you run the risk of prosecution. Even when you've completed the bankruptcy term you can't be involved in forming or managing a limited company without getting prior permission from the Court.

Pros and Cons of Personal Bankruptcy

The fundamental pro of a bankruptcy petition is that it frees you from debt. Just think of the stress that you could put behind you, allowing you to make a fresh start and move forward.

There are, of course, disadvantages to bankruptcy too. There's the possibility of losing your assets and having your business closed down. Any future creditors will be made aware of your status and you'll be forbidden from holding certain employment positions.


Individual Voluntary Arrangement (IVA):

  • Unsecured debts only
  • Initial debt advice is free but fees are payable if a debt solution is agreed.
  • An IVA should only be considered in extreme circumstances as failure to adhere could result in bankruptcy. Debt write off applies only where the IVA is accepted by at least 75% of your creditors (in terms of debt value) of those creditors who vote at the creditors' meeting convened to consider your IVA proposal and you have completed the, typically, 60 month term. Some homeowners may be required to release equity.
  • Fees and Costs: An estimate of the costs involved in the arrangement will be included within your proposal; however these fees are subject to change at the creditors meeting. Once the creditors have approved your IVA the basis of our fees will be set and an up to date schedule of fees will be issued to you. Chargeable fees are made up of Nominee's fees which relate to the assistance given to prepare your proposal and will be taken from the first payments made into your arrangement, and Supervisor's fees which relate to the ongoing monitoring, supervision and administration of your IVA and which will be charged on a monthly basis and deducted from the contributions you pay into the arrangement. No further fees are payable by you.
  • Credit Rating: A record of your IVA will be retained by credit reference agencies for a period of six years. Your credit rating will be impaired and it may be harder to obtain credit in the medium to long term.
  • Cooling Off Period/Right to Withdraw: You can withdraw your proposal for a voluntary arrangement at any point up and including the day of your creditor's meeting. Once the arrangement has been approved at the creditors' meeting and you have agreed to be bound by its terms, you have entered formal insolvency proceedings and no cooling off period applies.
  • Terms & Conditions apply.

The Insolvency Service have produced an 'In Debt? Dealing With Your Creditors' guide which summarises key features of each of the main ways of dealing with debt.

Financial Management Plans:

  • Unsecured debts only.
    Initial debt advice is free but fees are payable if a debt solution is agreed.
  • A key benefit of the Plan is the ability to only repay what you can afford each month. Clearly the consequence of this is that it will take longer to repay your debts, and creditors do not have to agree to freeze interest and charges. You will receive allowances to pay Secured and Priority debts.
  • Fees and Costs: An 'Initial Fee' is the set up cost of your Plan and is equal to two months disposable income, subject to a minimum of £295 and will be retained from your initial payment(s). Whilst you pay our initial fee, monies are not distributed to your creditors and this retained payment may place you in arrears.
    A 'Monthly Fee' payable for our services will be charged thereafter, equal to 17.625% of your monthly agreed disposable income, subject to a min of £35 and a max of £100.
  • Credit Rating: Entering into a Plan means contractual payments will be missed and your debt and repayment term could increase. Your credit rating will be impaired and it may be harder to obtain credit in the medium to long term as records will be retained by credit reference agencies for six years.
  • Cooling Off Period/Right to Withdraw: On receipt of your first payment we will issue to you a key features document and estimated fees schedule. If for any reason you wish to cancel we offer a seven-day cooling-off period from the date of said letter in which we offer a full refund of any fees which we have taken.
  • Terms & Conditions apply.

One Advice Group . Jackson House . Sibson Road . Sale . Manchester . M33 7RR . United Kingdom