Despite the undeniable disadvantages of declaring bankruptcy (which will be discussed in greater detail later), bankruptcy does exist for a reason, and in some situations it is not only the best, but the only realistic course of action available.
When you are unable to make loan repayments or pay off debts as they come due, you may need to consider filing for bankruptcy. By declaring bankruptcy or being compelled to do so, you are relieved of the burden of overwhelming debts and your assets are distributed fairly among creditors. A person can be declared bankrupt in three ways: voluntarily, involuntarily, or at the request of a supervisor if constrained by an IVA. Anyone, including individual members of a business partnership, can declare bankruptcy.
If bankruptcy can be averted, it should be avoided. If an Individual Voluntary Arrangement procedure is a viable option, it is highly recommended to pursue it, as a first-time bankrupt will typically receive their discharge one year from the date of the bankruptcy order, but an IVA places you in greater control of the situation and imposes fewer restrictions and consequences. Generally, bankruptcy has the following consequences:
- Loss of the ability to serve as a company director. Certified Public Accountant, Attorney, Justice of the Peace, Member of Parliament, or Local Authority Member. In addition, you may not participate in the formation or management of a limited liability company without the court's permission.
- Loss of control over one's possessions.
- Inability to obtain credit in excess of £250 (absent express lender permission).
- Credit is negatively impacted for years following the cancellation of a bankruptcy order.
As a result of these long-lasting consequences, the decision to declare bankruptcy should not be made carelessly. As previously mentioned, an IVA may be an option in certain situations, but if you find yourself in a position of forced or inevitable bankruptcy, it is always prudent to cooperate completely with the proceedings. Even if you decline to acknowledge the proceedings, they will proceed, so it is in your best interest to participate actively from the outset to exert some measure of control. Moreover, it is important to keep in mind that, as a result of filing for bankruptcy, previous concerns regarding excessive debt will be alleviated and, in some cases, discharge is possible within a year or even less.""
" - https://www.affordablecebu.com/
