Write Off Your Debts
Similar to a Trust Deed, a Sequestration allows you to pay what you can afford over a 4 year period and write off any unaffordable debt at the end of the process. Usually clients opt for a sequestration where they feel an insolvency is most appropriate for their needs, but it is unlikely they could meet their creditors' criteria for a Trust Deed to become Protected.
If you have assets, such as a home or motor vehicle (worth more than £3k) it can be more difficult to protect these than in a Trust Deed, but our experienced advisors would discuss this with you and make sure you understand all your options before you choose one.
Your credit file will show that you have been made Bankrupt, and this information will stay on your credit file for six years. As a result of this, you may find it hard to get credit, even after your Bankruptcy has ended.
During the bankruptcy, you will not be able to obtain credit of more than £500 without declaring to the lender that you are bankrupt.
Control of your assets will be passed to your Trustee. That includes any property that you own. It is not possible to exclude a property from a Bankruptcy. Understanding the implications for your property is a high priority and will inform much of our conversation with you.
What are the advantages of Sequestration?
- Affordable, monthly payments
- Write off debt you cannot afford
- Creditors cannot object
- Legal protection from you creditors
What are the disadvantages of Sequestration?
- Your credit rating will be affected
- It can be more difficult to protect assets, such as homes, motor vehicles and shares
- You will have to declare that you are bankrupt if you apply for credit of more than £500
- There is usually an application fee