Care and support

Assets

Once the bankruptcy order is granted, the Official Receiver, or appointed Trustee, may wish to sell any assets that you have. Certain goods are not treated as assets, for example, clothing, bedding, furniture and household equipment for basic domestic needs). Items necessary for you to carry on your employment such as books, tools or a car can be excluded. Your car might be sold if it is considered valuable although you may be allowed to purchase a cheaper one instead. Your car is likely to be sold as an asset unless you could prove to the Official Receiver or appointed Trustee that you needed a car for work or to accommodate a disability.

If the Official Receiver decides you have assets then they will usually be sold as soon as possible. If you are discharged from bankruptcy before any assets are dealt with they will not belong to you on discharge. Your assets will continue to belong to the Official Receiver until they are sold. The only asset treated differently is the house where you live.

The Official Receiver may apply to the court for an order restoring property to him or her if you disposed of it in a way which was unfair to your creditors (for example, if before bankruptcy you had transferred property to a relative for less than its worth). The trustee may claim assets which you obtain or which passes to you (for example, under a will) while you are bankrupt.

Hire purchase agreements

There may be a clause in the hire purchase agreement which allows the hire purchase company to terminate the agreement if you become bankrupt. In this event, you will have to return the item. If you wish to keep the item, it is possible for the hire purchase company not to cancel the agreement and for the trustee to allow you to continue to make payments.

Life assurance policies

Generally, the Official Receiver will be able to claim any interest that you have in a life assurance policy. They may be entitled to sell or surrender the policy and collect any proceeds on behalf of your creditors. If the life assurance policy is held in joint names, for instance with your husband or wife, that other person is likely to have an interest in the policy and should contact the Official Receiver immediately to discuss how their interest in the policy should be dealt with.

Wages

You may be asked to pay an amount to your creditors from your wages. This will only happen if have available income after paying ordinary household expenses. The Official Receiver can look at your income and expenditure and decide if payments should be made and at what level. When looking at how much you could pay they will take into account essential expenses such as your mortgage, rent, household bills and housekeeping.