How to Avoid Bankruptcy?

Many people who contact ClearStart are thinking about bankruptcy, or are worried about being made bankrupt against their wishes. It is important to make sure you understand what the implications of bankruptcy are and what other options are available. These options include the Individual Voluntary Arrangement (IVA), which was introduced by the government in 1986 to help people who would otherwise face bankruptcy.

You might want to take a look at a table comparing bankruptcy with IVA.

It is well worth remembering that the people you owe money to will often want to see an outcome other than bankruptcy. That is especially true if you can propose a way forward that returns more of the outstanding debt to them.

Bankruptcy does have some advantages – your debt problems are resolved and you will be in the process itself for a maximum of three years. However, most people would agree that other options are probably better.

Aside from an IVA, it is also possible that an option such as debt management might also work for some people. However, a Debt Management Plan is often more suitable when debts have not yet reached a very serious level.

Remember that specific facts and figures are of enormous value when reaching a decision of this kind – general principles are not a substitute for specific advice that takes your own finances and family circumstances into account.

Discuss your situation in confidence, call us on 0800 988 9345.

Further reading
Bankruptcy | Bankruptcy process | UK Bankruptcy Law | Avoid Bankruptcy | Effects of Bankruptcy | IVA an Alternative to Bankruptcy | Disadvantages of Bankruptcy | Bankruptcy FAQs