What happens when you declare yourself bankrupt?

If you have mounting debt that you can't repay, you may have declared yourself bankrupt. Bankruptcy is a type of personal insolvency, like an IVA, Trust Deed, or DRO. The credit reference agencies receive bankruptcy information from the Insolvency Service.

Once you’ve been declared bankrupt, your finances will be managed by a Trustee. They will work out how much can be paid and to who, and it’s against the law to be chased for debt that’s been included in the bankruptcy.

The bankruptcy will show in the Court Information section of your Checkmyfile report. You can see when it started, whether it’s active, and when it will drop off.

A bankruptcy will affect your ability to get credit. Some lenders may lend small amounts to bankrupts, but few do as bankruptcies are seen as a risk. If it’s been discharged, it’ll be removed from your credit report after six years, but you may still have to let future lenders know that you’ve previously been bankrupt. Although a bankruptcy will affect your credit score, there are steps you can take to help grow your score in the future. You can set yourself financial goals now and make sure you keep up with your payments going forward. Building the habits now to make the progress later.