An Official Receiver is appointed to protect your assets. They act as trustee of your bankruptcy affairs if you have no assets. If you have assets, an Insolvency Practitioner will be appointed to act as trustee and sell your assets to pay your creditors.
To read more, go to:. Once a bankruptcy order has been made against you, your creditors cannot pursue you for payment. The trustee is responsible for payments.
Once you're bankrupt, the Official Receiver, or appointed trustee, can sell your assets to pay your creditors. Certain goods aren't treated as assets for example:. If you own your home, you might have to sell the property.
This will depend on who owns the property, the value of the home, and whether the property is worth more than your mortgage. It may be possible for the joint owner or family and friends to make an offer to the official receiver to buy out your share of the equity. This is helpful if there is little or no equity. The Official Receiver can look at your income taking into account expenses such as your mortgage, rent and household bills and decide if payments should be made to your creditors.
You might be asked to sign an 'income payments agreement' to pay fixed monthly instalments from your income for three years. If you don't pay or if you don't sign the agreement voluntarily , the Official Receiver can apply for an income payments order from the court to order you to pay. This will run for at least three years from the date of the order. If your circumstances change, you'll need to tell the Official Receiver, so they can review these arrangements.
You'll still have to meet ongoing commitments such as rent or new debts after you become bankrupt. The Official Receiver or a trustee in bankruptcy can make other applications to the Court following a Bankruptcy Order. They include:. Even after the bankruptcy period, you may find it difficult to get credit. The Official Receiver does not send any form of notice to credit reference agencies.
Your lawyer can help you understand and navigate the filing process from your initial petition to final discharge. When you file for bankruptcy protection, a discharge from the court will relieve you of your obligation to repay your creditors for certain debts. Once your debt is discharged, your creditors cannot contact you or attempt to collect the debt in any way. A discharge of your debt is also permanent and final for all unsecured debt you include in your bankruptcy filing.
The timing of your discharge will vary according to the type of bankruptcy you filed. A Chapter 7 bankruptcy discharge order can take as little as four months while a Chapter 13 bankruptcy discharge can take three to five years. If you are represented by a lawyer in your bankruptcy filing, you and your lawyer will each receive a copy of your debt discharge order.
Your lawyer will help you understand what happens if you declare bankruptcy and which debts were discharged by your bankruptcy filing as well as those you might still be obligated to pay. Get the financial relief you are entitled to by filing for bankruptcy protection. Our team represents individuals and small business owners in Chapter 7 and Chapter 13 bankruptcy cases. We can also provide help filing for Chapter 11 reorganization bankruptcy and Chapter 12 bankruptcy for family farmers and fishermen.
We can help you through the petition and filing process. At any time, you can update your settings through the "EU Privacy" link at the bottom of any page. These choices will be signaled globally to our partners and will not affect browsing data. We and our partners process data to: Actively scan device characteristics for identification. I Accept Show Purposes. Your Money. Personal Finance.
Your Practice. Popular Courses. Part Of. Bankruptcy Basics. Types of Bankruptcy. Personal Bankruptcy. Corporate Bankruptcy. Bankruptcy: Your Legal Rights. Bankrupty Terms C-I.
Bankrupty Terms J-Z. Key Takeaways Filing for bankruptcy is one way to get out from under a crushing debt load, but it has negative consequences that can last for years. The two common types of personal bankruptcy—Chapter 7 and Chapter 13—will stay on your credit record for 10 years and seven years, respectively.
Before filing for bankruptcy, it's worth contacting your creditors to see if they are willing to negotiate. Many lenders, for example, have programs for people who are having trouble paying their mortgage. Article Sources. Investopedia requires writers to use primary sources to support their work. These include white papers, government data, original reporting, and interviews with industry experts.
We also reference original research from other reputable publishers where appropriate. You can learn more about the standards we follow in producing accurate, unbiased content in our editorial policy. Related Articles. Debt Management Bankruptcy Rates by State. Instead, your debts will be reorganized so that you can pay them off partially or in full over the next three to five years.
Keep in mind, though, that if you don't comply with the payment plan, your creditors may be able to go after your assets to satisfy your debts. When you declare bankruptcy, it's a sign that you are no longer paying your debts as originally agreed, and it can seriously damage your credit history.
That said, the two types of bankruptcy aren't treated the same way. Because chapter 7 bankruptcy completely eliminates the debts you include when you file, it can stay on your credit report for up to 10 years.
While chapter 13 bankruptcy is also not ideal from a credit standpoint, its setup is viewed more favorably because you are still paying off at least some of your debt, and it will remain on your credit report for up to seven years. Shortly after your bankruptcy is discharged by the court—meaning you no longer owe the debts you've included in your filing—it may be difficult to get approved for credit, especially with favorable terms. There are some lenders, however, who specifically work with people who have gone through bankruptcy or other difficult credit events, so your options aren't completely gone.
Also, the credit scoring models favor new information over old information. So with positive credit habits post-bankruptcy, your credit score can recover over time, even while the bankruptcy is still on your credit report. Are Bankruptcy Filings Publicly Available? Bankruptcies are considered a public record, but that doesn't mean everyone's going to know about it. For the most part, it's more common for attorneys and creditors to use this system to look up information about your bankruptcy.
But anyone can register and check if they want to. The service charges 10 cents per page to access case information. Another way people might find out about your bankruptcy is if your local newspaper publishes public notices.
Finally, employers, landlords and creditors may be able to see on your credit report that you've filed bankruptcy when you apply for a job, an apartment lease, or a loan or credit card. Twenty-nine percent of employers run a credit check on new job applicants, according to a survey by CareerBuilder.
As a result, declaring bankruptcy could affect your ability to get a new job, especially if that job is in the financial services industry or with a government entity. They do this primarily to make sure you're a good fit for the jobs—such as handling money—and that you're not financially stressed, which could increase the likelihood of theft or fraud.
If an employer simply runs a routine criminal background check, however, your bankruptcy won't show up. It's less likely that employers would conduct background checks on current employees.
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