Bankruptcy: credit score impact

Worthiness of financial stability is always judged by individual credit scores

08:38 10 October 2013

Bankruptcy is the roadblock in your financial proceedings. So this should be the last option in saving yourself from creditors.

Since filing for a bankruptcy is never really a good thing, there will be consequences which you have to face too. These disadvantages may include the following:

• When you filed for bankruptcy, you will not be allowed more credit.

 

• You could lose your properties such as your house. You could also lose some of your personal belongings which are of value especially if the amount of your debt is greater than the value of your house. You may be allowed, however, to apply for a rehousing.

 

• Some employers do not retain workers with bankruptcy history to their names.

 

• If you own a business, the official receiver may also take control of your business by closing it down, terminating your staff and selling all assets owned by the business.

 

• Bankruptcies are listed in the Insolvency Register, which can be accessed by anyone in the internet so it is almost like you broadcasted to everybody that you have trouble with finances.

 

• Bankruptcies can also affect one’s immigration status - you may not be allowed to go out of the country.

 

• In the event that you did not cooperate with your official receiver, or when you took on debts even if you knew there is no chance you will be able to pay for them, a bank restriction order will be filed against you. This is more serious as they will closely monitor and restrict your financial transactions and this will last for 15 long years.

 

• Expenses when you file for bankruptcy could cost you £700 or more.

 

Considering these numerous disadvantages, it would have been much better to consider other options available rather than filing for a bankruptcy however difficult these options are.