When your neck is deep in debt, any promising solution may look just perfect to you. In that sense, you may even consider going bankrupt. While bankruptcy may have its benefits, you cannot take any decision about debt matters without assessing its impact on your financial and daily life. In this article, you will come across some critical factors around this type of debt solution so that you can evaluate your situation thoroughly.
Before getting started, let’s be clear that bankruptcy may or may not work. So, taking expert advice on this issue can be highly advantageous for you. Also, where you reside in the UK can play a significant role in this because of rules and regulations. Nevertheless, you can opt for it if you can relate to these points:
- There is no other option left with you for debt repayment
- You don’t have any personal assets, including very less or no equity in the home
- The situation is beyond repair
You don’t need any specific amount to qualify for a bankruptcy filing. You can go ahead with it if the amount of your unsecured debt, such as credit card bills and personal loans, are excess than your valuables.
Similarly, it may not be the right choice for you if any of the following things hold in your case:
- Your pension amount is more than your debt.
- You work as a solicitor, estate agent, or account (you may lose your association membership if you choose bankruptcy).
- You don’t want to make your financial status public.
- You expect inheritance money or claim money from a possible source.
- The debt amount is under £20,000, and your possessions value less than £1,000 (in that situation, looking for debt relief can be ideal).
Going bankrupt is a big decision; hence, you may need to take your steps carefully. The process may cost you £680. So, you should be able to afford it. After bankruptcy, you may lose your home and not find any rental place as well. Your credit score may get a hit. You may also have to let go of your possessions, except for necessary household items, to pay creditors from the proceeds.
However, if your debts are extreme, then you can take this route to reduce the financial burden from your life. The process can prove beneficial to you for a couple of reasons.
Benefits of applying for bankruptcy
- You may no longer need to deal with numerous creditors and the daily stress individually
- If granted, you will have an administrator who will talk to your lenders and handle payments on your behalf
- You will pay less amount than what you owe
- Whatever settlement happens between you and them, they will have to stick to it
- After discharge from bankruptcy, you may not have to pay some debts. Also, creditors cannot pester you with demands for payments
You need to get the nuances right before making up your mind. For advice, you can approach a credible debt solutions company, such as Positive Debt Solutions.
