If you find yourself in a position where you cannot afford to pay your debts, then bankruptcy may offer a way out. In the event of your bankruptcy, your assets will become the property of your creditors and your debts will be completely wiped out.
Bankruptcy is not an easy option, and it can cost a fair amount of money to file for it. For starters, you will have to pay a deposit of 250GBP to cover administration costs, and you may also have to pay a court fee of 120GBP and an affidavit fee of seven pounds.
Business partners who are declaring bankrupt at the same time will have to pay separate fees, unless they file jointly. Married couples also have to pay separately. You can pay with a bankers or solicitors cheque, but not a personal cheque for obvious reasons, with a postal order, or with cash.
Where your petition will be presented depends on where you live. Those who live in London will have to present their petition at the High Court, but if you live anywhere else in the UK, you will need to find the nearest county court that deals with bankruptcy.
Although the court might be able to hear your petition immediately, it is more likely that you will be given a specific date and time for a court appearance. If English is not your first language, you will have to find and pay for an interpreter, as the court will not provide one for you.
At the hearing, the court may decide to appoint an insolvency practitioner, dismiss your petition in favour of an Administration Order, delay proceedings until more information becomes available, or accept your petition for bankruptcy.
If the court does decide to accept your petition, you will be made bankrupt with immediate effect. If you have never been made bankrupt before, and have debts of less than twenty thousand pounds, they might issue a certificate of summary administration, which will reduce the length of your bankruptcy period.
If the court issues a summary administration certificate, the bankruptcy itself will last a period of one year or less. However, if the court does not issue an administration certificate, the process could go on for as long as three years before you are discharged.
