What Happens To Assets In Bankruptcy

What Happens To My Assets In Bankruptcy?

This section covers the questions you are most likely to want answered about what will happen to your assets if you are made bankrupt.

When you are declared bankrupt, you surrender all your assets, i.e. possessions of value, including any interest in your home.

The Trustee must be informed of all assets, it is their decision as to what you can keep.

They will arrange for their sale, using the proceeds to pay the fees, costs and expenses of the bankruptcy, before paying the creditors.

When the bankruptcy order is made, your bank and savings accounts are seized by the Trustee.

If your bank account is in credit, the balance is a asset in the bankruptcy.

Items Excluded From Bankruptcy

It is only reasonable that you be allowed to keep essential items and are not impeded from earning a living. Items which can to be excluded from bankruptcy include:-

• Household items essential for basic domestic needs. e.g. Clothes, Furniture, TV etc.
• A modest vehicle depending on circumstances, see - Bankruptcy & Your Car.
• A residential tenancy.
• Items needed for trade or employment such as tools and computing equipment.
• Money obtained from a student loan, if a balance of the loan remains payable.

For information about property see - Bankruptcy & Your Home.

Bankruptcy is just one of several options to be considered when you cannot repay your debts.

If you are ever faced with the prospect of bankruptcy you should always look at alternatives as soon as possible such as an Individual Voluntary Arrangement or a Debt Relief Order.

What can I keep if I'm bankrupt?

You can keep any tools, books, vehicles (if low value) and other items of equipment needed personally in your employment or business.

You will also be able to keep your clothing, bedding, furniture and basic household items.

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