Being bankrupt in the UK is the worst state possible for your credit rating. Being made bankrupt or declaring yourself bankrupt should always be the very last option to take when you are struggling with your debts and can no longer manage your money properly.
Being bankrupt is so serious that it can even affect your ability to open a bank account although there are some bank accounts for bankrupts which are specially designed for people who have been declared bankrupt.
As part of being bankrupt an official receiver will seize all of your assets to help pay off your debts, this includes things like your car, certain possessions and maybe your home too. If youre employed then you could be made to pay part of your wages towards your debts each month as part of your bankruptcy order.
If you plan to go self-employed at some point in the future then you may find that youre not allowed, by law, to be a company director. There are also some jobs that you would not be able to apply for because of your bankruptcy too.
Gaining finance and credit will become more difficult too, from obtaining small loans to car finance and even getting a mortgage. You will find it much more difficult to obtain these things in the future. Because of this you really should only consider bankruptcy as your very final option when it comes to your debts and money management.
