Bankruptcy Information In Uk

The bankruptcy laws in United Kingdom were created to help people get rid of debts that they cannot repay

. People declared bankruptcy to stop the flood of debt letters and calls from collection agencies. A person, if granted the status of bankrupt, all his assets deemed non essential by the government is liquidated and the fund collected is distributed among debtors. Once the assets are liquidated, the creditors are no longer legally eligible to demand payment from the individual.

Generally, the idea is popular among people that declaring bankruptcy means freedom from all the debt. This is a myth only and not entirely true. Not all the loans are neutralized by declaring bankruptcy. Debts such as child support, educational loan and law suit are not exempted by bankruptcy. A person has to pay the court dictated sum of money to the divorced partner announcing bankruptcy doesnt prevent this.

The disadvantages of announcing bankruptcy is that all the major non-essential assets will be liquidated. If the person has his or her own home then it will be taken away. Similarly, the person in UK can only have a car of maximum valuation two thousand pounds. Also, being bankrupt once means the task of getting a loan or credit card will get very hard for him or her. A bankrupt person is not permitted to set up business in UK. Above all if the person had been secretive about his or her debt problems in the past, announcing bankruptcy brings the problem to public knowledge. The embarrassment that is to be endured by a person is great once the individual declares bankruptcy.

The people in UK who apply for bankruptcy are those who have gone through a traumatic event that influenced their life. They have gone through incidents of losing their job, major illness or suffering disability, a breaking marriage, etc. The debt that is accumulated at this harrowing time is quite an uphill task to pay back in normal circumstances.

Bankruptcy is such a critical issue for a person, he cannot decide without the help of professional bankruptcy advice. Debt Release Direct is bankruptcy consultant UK. They provide excellent professional bankruptcy advice.

by: Christopher Duncan

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