Bankruptcy - known in Scotland as sequestration - is an option to consider when you cannot repay your debts over a realistic period. Bankruptcy may be an option where you simply cannot reach an agreement with your creditors, and your financial situation has become complicated to manage.
You are likely to be under a lot of pressure, with your creditors competing to collect their debt from you. At present, there are two formal processes for applying for bankruptcy. The first is the Minimum Asset Process (MAP). The second is called Full Administration Bankruptcy (FAB) - sometimes known as the ‘standard bankruptcy process’.
- Priority and non-priority debts
- Bank accounts and debt
- Drawing up a budget sheet
- Negotiating reduced payments to your debts
- Free Debt Management Plans
- Debt Arrangement Scheme
- Trust Deeds
- Formal bankruptcy or a ‘sequestration’
- Write Offs
- Will I be 'blacklisted'?
- What can creditors do if I don't pay?
- Should I tell creditors about my mental health?
- Getting help from a specialist adviser
- Next steps