All too often people who would benefit greatly from the protection of Bankruptcy dismiss the idea out of hand due to nothing more than misplaced fear caused by a simple lack of knowledge of the facts.

Suitable circumstances for those who might benefit from entering into the protection of a Bankruptcy Order:

• People with no assets (including those with no equity in their property)
• People living in either rented accommodation or with friends and family
• Those whose employment would not be lost or adversely affected by a Bankruptcy Order
• People who agree with the moral aspect of bankruptcy

It is a generally held misconception that bankruptcy is punitive and that bailiffs will seize your goods and chattels leaving you nothing but a change of clothes. This is false. You enter the protection of a Bankruptcy Order to do exactly that; to protect yourself from creditors and to allow you to wipe the slate clean and get a fresh start. Under Section 283(2) of the Insolvency Act you are allowed to keep the tools of your trade, all clothing, bedding, furniture and even your car (provided it’s not too expensive and subject to certain conditions).

Remember there are other alternatives to bankruptcy, make sure you check out all of your options before making your final decision.
Other Alternatives:

• Debt Management Plans
  
• IVA
  
• Trust Deeds
  
• Consolidation Loan

Debt Management Plans
A debt management plan is an informal way to repay your debt at a set amount every month and it allows you to manage your finances comfortably each month.
Debt Management plans offer:

• One Monthly Payment
• Interest and Charges Stopped (not in every case)
• Reduced Monthly Expenditure
• Creditor contact may stop

Debt Consolidation
A Debt consolidation loan is normally using equity in a property to consolidate existing credit into one affordable payment, these are also known as Secured Loans or Second Mortgages. If you have equity in your property then a secured loan maybe the better debt solution for you.
What debt consolidation offers:

• Consolidation Loans offer
• One Monthly Payment
• Lower Monthly Payments
• Reduced Interest Rates

Individual Voluntary Arrangements (IVA)
An Individual Voluntary Arrangement (IVA) is a formal legal agreement between you and your creditors and it allows you to pay your debt at a set amount over a set period of time.
What Individual Voluntary Arrangements (IVA) Offer:

• One Monthly Payment
• Reduce Monthly Costs
• 75% of debts written off
• Debt free in 60 months
• Interest and Charges stopped and frozen

Government Debt Help Schemes
The governments have introduces a number of different debt solutions to help people get their finances back on track. These government debt solutions are not available to everyone as the criteria to apply for these government schemes are very strict.
What government debt help schemes offer:

• One Monthly Payment
• Reduced Monthly Payment
• Debt Free in 12 months

Protected Trust Deeds (PTD) – Scotland Only / Scottish Trust Deeds
Protected Trust Deeds are very similar to Individual Voluntary Arrangements (IVA) as they are a formal way to repay your creditors at a set rate over a set period of time.
What Protected Trust Deeds offer:

• One Monthly Payment
• Reduced Monthly Payment
• Debt Free in 36 Months
• Write off up to 90% of your debt
• Not Interest and Charges

Sequestration – Scotland Only
Sequestration is the Scottish version of Bankruptcy and it is very similar. Because it is the last resort to solving debt problems you must be fully informed before making the final decision on this debt solution.