Bankruptcy – protection from legal action but you lose some control
Choosing to go into bankruptcy
You can decide to declare yourself bankrupt. This is called a ‘debtor’s petition’. Always talk with a free and independent financial counsellor first and explore other options. Bankruptcy may be suitable if:
- You will not have enough money to live on if you pay all the monthly repayments on your loans and debts.
- You do not have assets that could be sold to repay the debts (for example, you rent your home and your only other asset is a low value vehicle).
- You understand, and can live with, the restrictions that bankruptcy will bring now and in the future.