How Long Does Bankruptcy Last?
The normal time for a bankruptcy order to last is twelve months. This is often an attractive proposition when compared to the sixty-month duration of an IVA. Bankruptcy is not only in force for a much shorter time but the amount you pay back is a lot less too. After you reach the end of the order and are discharged, most of your debts are wiped clean. You effectively have a clean slate. Make the most of it and don’t get into further debt. More debt problems now, could result in a longer Bankruptcy order in the future. Bear in mind, that although you will be clear of debt, credit reference agencies will keep a note of your bankruptcy on file for six years.
What Happens if I Pay What I Owe Early?If you manage to repay your obligations before the end of the bankruptcy order the person in charge of ensuring your adhere to the order can petition the court for early Dismissal or annulment.
What if I Can’t Pay?If you do not manage to meet the conditions of the bankruptcy order thena court appointed receiver can apply to the courts to have your dismissal delayed giving the Creditors more time to get their money back. You must make all the payments that are required of you to be discharged. If your dismissal was delayed before 1st April 2004 then you will need to contact your local Bankruptcy Court to see when you can be discharged. You can apply after a period of five years for a dismissal but this is at the courts discretion
Future Plans?If your home was subject to the bankruptcy order but was not dealt with before your discharge, don’t assume that it is safe. Your assets can be sold at any time in the future, even years later. If you want to make sure this doesn’t happen you can get your partner or family member to buy your share in the property, thus keeping it in your name. The money you get should satisfy the order requirements.
Can I Keep the Assets I Inherited During My Bankruptcy?You have to declare any assets you acquire during your bankruptcy order as they may need to be sold to pay your creditors. It is also worth noting that you are required to make sure that you support your Trustee even after discharge. As mentioned before the consequences of bankruptcy can be far reaching.
The overall time that a bankruptcy lasts can, therefore, vary depending on how you comply with your order. The more effort you make the more lenient the court is likely to be. If you are obstinate and awkward then the court will take a dim view of your behaviour and will probably be more harsh with its ruling. The best thing to do to ensure that you are discharged as early as possible is to make every effort to pay back the money, be honest and show remorse. A court wants to be sure that you will not do the same thing again the minute you are discharged.