Michael Chamberlain and Colin Savile explain the finer points of bankruptcy.
What is bankruptcy?
Bankruptcy is a formal insolvency procedure used to help deal with the affairs of individuals where their liabilities exceed their assets or they are unable to pay their debts as they fall due. The declaration of bankruptcy (“bankruptcy order”) is made by the courts and can be obtained by any creditor (owed over £750 after the required processes have been satisfied) or by the individual concerned, applying to court.
A ‘lighter’ form of bankruptcy called a ‘Debt Relief Order’ is available to insolvent individuals who have less than £15,000 of debt, negligible surplus income and who do not own their own home.
We realise that each assignment presents a unique set of problems which require innovative solutions. Our initial focus is often to find success through discreet restructuring and reorganisation of finances and affairs. When this is not feasible we examine formal and informal arrangements with the various creditors and other stakeholders. In some cases the most appropriate option is to crystallise the position through the use of insolvency options such as administration, liquidation or bankruptcy.
Whatever the situation we will be able to advise you and implement the most appropriate solution.