How Do I Go About Declaring Bankruptcy?

The legal process of petitioning for your own Bankruptcy has a number of important stages.

The first stage is to speak to a registered debt charity, such as those listed at the bottom of this article, as it may be that Bankruptcy is not your best option. They will access your financial situation in detauil for free. They will then talk to you about all of the alternatives available to you and recommend which solution they believe is right for your situation. It may be that you qualify for a Debt Relief Order or an Individual Voluntary Arrangement, which may be much more suitable for your situation depending o your level of debt and whether you have any assets (such as a property) to protect.

If an advisor agrees that declaring bankruptcy is the most appropriate solution for your circumstances then you need to complete a bankruptcy petition form, which is your official appeal to the court to be made bankrupt, and a statement of affairs, which contains an in-depth assessment of your financial details and the reasons for getting into debt. The forms are both available to download online at the insolvency service (the official regulator of the insolvency industry) website or is obtainable from your local county court.

Petitioning for your own bankruptcy can cost as much as £622, which is made up of three separate costs:

A court fee of £150 (although you may not be required to pay this if you're in receipt of income support). Bankruptcy deposit of £450. A fee of £12 to swear the affidavit if you're petitioning at the High Court in London.

When declaring bankruptcy you must attend court for a bankruptcy hearing (generally, you should petition at your local court, which is the place where you've lived or worked for the last six months).

After the court has listened to your petition, one of the following outcomes:

A stay in proceedings - the bankruptcy hearing is put on hold until more information is gathered that may be material to the proceedings Decline bankruptcy in order to appoint and Insolvency Practitioner to administer an IVA Decline bankruptcy petition in favour of an Administration Order Decline bankruptcy and refer you to an Approved Intermediary for a Debt Relief Order Bankruptcy Order (which means the petition has been successful)

In theory, the court is supposed to weigh up whether declaring bankruptcy is your best option or whether there are more suitable alternatives. However, in practice, the judges tend to nod them through as county courts are generally overstretched. That's why it's so important that you take impartial advice, you can't rely on the judge to tell you whether you're making a mistake.

Once the Bankruptcy Order has been granted, the court will appoint a Trustee in Bankruptcy to manage your financial affairs. This will be either the Official Receiver or an appointed Insolvency Practitioner.

- National Debt Helpline (0808 808 4000)

- Debt Advice Foundation (0800 043 40 50)

- CCCS (0800 138 1111)