Bankruptcy Searches

Bankruptcies are the last resort when it comes to paying back the money that you owe. 

It is not advised that you lend money to bankrupt individuals. 

But how do you know if someone is bankrupt?

I answer that question in this article. I’ve explained how bankruptcy searches work in this article.

Let’s get right to it!

What Bankruptcy Means

Bankruptcy is a legal process by which people who can’t afford to repay their debts can seek relief from some portion of their debts at least. In England and Wales, bankruptcy is only imposed after a court order known as a bankruptcy order.

Companies, as well as people can be declared bankrupt. If a company is declared bankrupt, it has no financial bearing on any of its employees. 

However, when a person gets declared bankrupt, their assets are measured and valued. These assets may be sold to other users to pay some portion of the debt. Bankruptcy offers you a chance to start fresh as the rules say that you will be debt free by the end of it. 

However, a person who is declared bankrupt might not be able to pay back his creditors and might have reached a state of insolvency. 

To be declared bankrupt, you have to go with your representatives to court and plead your case in front of the judge. You and your representatives must establish that you do not have the money to pay off the whole debt that you owe.

Moreover, you have to prove insolvency and show all your assets. Your representatives have to make sure that every asset that you own is shown in the court. The judge will then value your assets against your debts.

If your debts are considerably larger than your assets, you will be declared bankrupt by the government of the UK. It is rare that appeals for insolvency are rejected in court. Just get good representatives in court because small mistakes in court change the decision.

Bankruptcy Searches

Before lending someone outside of England and Wales money, it is recommended that you carry out a bankruptcy search against their name. Bankruptcy searches are simply looking at the bankruptcy status of a certain individual before lending them money..

Bankruptcy searches are useful because they allow you to separate an insolvent beneficiary. You should avoid distribution to an insolvent beneficiary at all costs. 

This is because the beneficiary isn’t likely to pay the money back and this is partly the responsibility of the lenders later on instead of the borrowers. Paying any money to a bankrupt beneficiary even inside the UK is a bad idea, let alone outside the country.

By conducting bankruptcy searches, you can filter out the people who cannot repay your debt from people who can do so. It is important to only lend money to a beneficiary with a good credit score as these are usually the ones who don’t end up defaulting.

There are different services operational in the UK that help you in conducting a bankruptcy search. For a small price, they can run background checks on the potential borrowers for you.

Also, even in covid 19 circumstances, you need to remember to run a small bankruptcy search to make sure that he’s reliable. I know it is harder to run checks over telephone lines but you simply have no other choice.

estate funds

FAQs

Is There A List Of Bankrupts?

Yes there is. Bankruptcy in the UK is public record. This is because all the court proceedings are public information. It isn’t hard for someone who’s looking for it to know that you’re bankrupt. 

The UK government also makes it a public record to ease the negative picture of bankruptcy in people’s minds. 

How Do I Know If My Bankruptcy Has Been Discharged?

You can search ‘Public Access To Court Electronic Records’. This is an electronic platform accessible for everyone in the UK. This shows you all the cases filed in a public court. You can use this platform to find your case and know your exact discharge order.

How Do I Find Bankruptcies on Public Records?

Again, you can access public records to know about everything that has been going on in a court. Some companies use this to find out if someone they’re giving a loan to has been declared bankrupt in the near past.

How Often Do Bankruptcies Get Denied?

Bankruptcy denials are extremely unusual. The only denials that happen are because of a lack of attention on the part of an attorney or an error made with the petition. Other than that, not many bankruptcies get denied in the UK.

Why are bankruptcies included in the public record?

Bankruptcy records are simply the cases in courts. Since a bankruptcy case is taken to a court, it is public information. Court proceedings are always public information unless the judge orders the complete sealing of records.

It is highly unlikely that a judge would seal off bankruptcy records. This means that your bankruptcy will probably always be public information.

Afterword

Bankruptcy isn’t something to be ashamed of.

Many celebrities are bankrupt and most counsellors use this example to persuade people to opt for the option.

Just make sure that you are aware of your options before you make such a decision. 

If you need more help, reach out to me on the email address given below, I’ll make sure to help you.

Good luck!

About the author

Scott Nelson

Scott Nelson is a financial services expert, with over 10 years’ experience in the industry, including 6 years in FCA regulated companies. Read more
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