Debt management can go wrong, and bankruptcy isn’t exactly something that people want to talk about. There are consequences of filing for bankruptcy, but what’s worse is the fact that many of us don’t know much about the process. You can choose to file for bankruptcy on the government website, for which a fee must be paid, and after this, a bankruptcy trustee will be appointed. The trustee will take control of assets to repay creditors to the extent possible. In this post, we will talk about the myths surrounding bankruptcy.
Myth 1 – I will lose everything I have
That’s what most people think when they file for bankruptcy, but that doesn’t have to true completely. Yes, the trustee will freeze your accounts and take control of your assets, but not everything. The tools of the trade, such as the car you take for work, and some of the personal belongings of your family required for survival will not be included. It might be possible to retain your home too, in certain cases.
Myth 2 – I can hide my assets
While people have tried that to deal with a bankruptcy order, the consequences have been severe to say the least. In fact, this has led to more complicated situations, and the last thing anyone would want is more financial distress. Consider your trustee on your side, and you can work around a debt management plan that’s feasible and effective.
Myth 3 – Creditors cannot force me into bankruptcy
Sadly, creditors can petition for your bankruptcy, although that’s usually a costly affair for them, and they can only do so when the dues are over £5,000. They may send a formal demand for money, called the statutory demand, after which they will send the bankruptcy petition. If you have received either of the two, do not ignore the same and make sure that you take advice from professionals at the earliest on handling insolvency.
Myth 4 – I have to give away my car
It may seem likely that you have to give away your car for bankruptcy order, but there are certain situations where you might be able to retain the vehicle. If the car is required for generating income or for employment, you can still possess it. However, the cost of the vehicle and whether it is yours or on finance are aspects that will be considered.
Myth 5 – I cannot work or find a job
Yes, bankruptcy will affect your career in some form or the other, but it doesn’t stop you from finding work. How else are you supposed to repay the creditors if you don’t have a job? Bankruptcy does impact your ability to get credit and will appear on your credit file for six years, but when it comes to working, you can work, unless you are a director of a company.
Contact the business rescue experts to know more on how to manage your financial issues and debts. They can advise you on how to get more from your situation and protect the assets that’s possible.