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Bankruptcy is a debt solution and a form of insolvency. It’s a legal procedure mainly suited to people whose circumstances are unlikely to change and who have little hope of paying off their debts within a reasonable time.
Bankruptcy works differently depending on where you live in the UK. If you’re living in Scotland please visit our section on sequestration (Scottish bankruptcy). If you live in England, Wales or Northern Ireland the information below outlines the bankruptcy process.
Bankruptcy is a form of insolvency, and normally only suitable if you can’t pay back your debts in a reasonable time. Any assets you own, such as your house, will normally be sold to pay off your debts. This means if your assets are worth more than your debts, or if all of your regular payments are up to date and you can afford to keep paying them, bankruptcy is unlikely to be the best option for you.
When you make yourself bankrupt almost all of your unsecured debts are written off, allowing you to make a fresh start. But personal bankruptcy rules mean you will face certain restrictions.
“I wish to thank your staff for all the great help they gave me when I was in so much debt.They were a pillar of support to me.” (Leslie, Essex)
Foundation for Credit Counselling Wade House, Merrion Centre, Leeds, LS2 8NG trading as StepChange Debt Charity and StepChange Debt Charity Scotland. A registered charity no.1016630 and SC046263. It is a limited company registered in England and Wales (company no:2757055). Authorised and regulated by the Financial Conduct Authority.
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