Bankruptcy is not a great process to enter into.  There will be some advantages which are discussed in another section, but first it is important that you understand the consequences that bankruptcy can have on you and your family.  In a bankruptcy you should be prepared to lose everything.  It may seem as though bankruptcy is the easiest way for you to get your debts cleared up, but unfortunately there are heavy risks to the entire process.  You could lose your home, estate, cars, and any other asset you may have.

First you have legal consequences.  A trustee may consider a debtors conduct is worthy of legal action.  For example a person that incurs debts that they knew they could not repay is an option for legal repercussions.  If a person gives away assets or sells them at less than the value in order to avoid losing everything it can have legal consequences.  Gambling or rash actions can be illegal.  You also have issues if you don't cooperate with the trustee during bankruptcy.  These are all negatives that you must consider when you are trying to solve your debt issues.

Your credit rating will suffer.  With your credit rating you will be in the poor to bad section for several years, even after a bankruptcy has been discharged. 

While it is not one that should affect your overall decision there are social repercussions.  Bankruptcy has a stigma that you were not a good person.  The truth is far from that in most cases and you are not a bad person debt wise. It is mostly the situation that occurred, but this doesn't always matter with the social realm.

There are banking consequences.  In fact banks may freeze or close accounts due to a bankruptcy.  This means that money will be tied up until the discharge and creditors have been taken care of.  You may have to use cash rather than your bank account.  You may also have a hard time getting your bank to cash checks.

Financial consequences of the bankruptcy are the worst.  With finances you are unable to get credit.  For the first 4 years of a bankruptcy you will not be able to get any credit over £250.  You may also be refused credit from banks, building societies, credit cards, and any other type of credit line.

Even if you don't currently have issues with some of your creditors you can expect issues to arise.  For example with utility companies there may be issues in which you are not able to have the utility until the payments have been made to them.  This means that you need to solve that issue before the bankruptcy goes to court.

Health is also an issue with bankruptcy.  Many individuals who are stressed begin to feel ill as a result.  It can lead to some health issues.  While these are not typical disadvantages they can be a problem in not getting the health care you need as a result of the current bankruptcy.

By seeking help you can avoid some of these bankruptcy issues, so act now.