As Tupac Shakur once sang, “Life Goes On”. Bankruptcy needn’t be the end but the start of a new chapter. Read my experience of being declared bankrupt.

Cost

What surprised me most about filing for bankruptcy was the cost. Considering you are meant to have no money, the whole process cost me about £1,000. This included professional help from a bankruptcy expert who charged around £300 and court fees, which were just short of £500.

Debt

My feelings immediately after being declared bankrupt, were inappropriately euphoric. An enormous weight had been lifted off my shoulders. Bailiffs acting for the multitude of companies I owed money to could no longer send me threatening letters, make intimidating out of hour phone calls or generally harass me. These actions had instantly become illegal. I had the protection of the bankruptcy courts and armed with my unique insolvency reference number I could counter their threats.

I may seem flippant of the situation but anybody who has experienced bankruptcy or indeed anyone with serious debt issues can appreciate the feeling I received when those debts were cleared. I’m not in any way happy with the decision to file for bankruptcy and still feel extremely remorseful to everyone I owed money to.

Insolvency service

It wasn’t long however, before the reality of the situation began to sink in. In the UK, immediately after the declaration of bankruptcy, you have to speak by phone to the insolvency service that will administer your affairs. The small private room I was ushered into, with its direct line to the local insolvency office, was almost cell like. The phone rang and without a ‘hello’ or ‘how are you’, I found myself giving over a list of all possessions of any value.

At the time I owned a family car and a van for work. One had to go and straight away I had to decide which one. I chose the van.

The journey home was a little eerie. Aside from the phone call to the insolvency office nothing had yet happened. It was the expectation of what was to come combined with the relief of losing the debt that made the whole situation very surreal.

Humiliation

Most family members knew that the bankruptcy hearing was approaching but talking about the court appearance became harder. Fortunately, you no longer have your name published in the local press but the humiliation still exists along with the feeling of failure. At forty years old, I should be at my prime earning ability with a solid bank account.

Official Receiver

The interview with the insolvency service was arranged within a couple of weeks of the bankruptcy declaration. This was the hardest part of the whole process. To have a complete stranger interrogate you on your financial affairs is demeaning enough but when they happen to be an expert and already know the answers to the questions they are asking it becomes a very sobering experience.

It was at this point that you learn the probable fate of your property. I was lucky and managed to keep the family home due to two charges against it and therefore its negative equity. If the house had been seized by the Official Receiver, I would have been given notice of about a year, mortgage free, to enable me to save up for rented accommodation.

The average bankruptcy last a year and exceptionally maybe a couple of months earlier. Unless there was anything untoward to examine and so lengthen the investigation, I should expect this average.

Credit

So that was it. Apart from a letter here and there, I rarely heard from the Official Receiver. They contacted all my creditors and inspected piles of paperwork. Life continued fairly normally. It was the failure of my business that had forced the bankruptcy so I was out of work. Should I have received a salary then part of it would have gone to paying back the creditors. If I wanted credit facilities then I had to let the provider know of my situation on any credit over £500.00. The chances of getting any credit for the next few years are highly unlikely anyway and not something I plan to try. My bank account had been frozen but a suitably similar one was available at the co-operative bank.

Discharge

Six months after being declared bankrupt I was discharged. I’m not sure if this is a record but it was certainly a surprise to come so soon. Now life goes on. You have to deal with the negatives in life as best you can. Sometimes it’s too easy to wallow and complain. I’m sure there are plenty of people complaining that I owe them money and rightly so. My life now is back on track and I’m a lot happier than I have been for a long time. Looking back, the bankruptcy period was a time of uncertainty, humiliation, shame and distress. Yet by keeping my dignity and a rational sense of family values I always managed to look at the future.

Similar Posts:

Share