Can I File Bankruptcy For Free - What Are the Costs of Filing For Bankruptcy?

The legal processes involved in filing bankruptcy will vary depending what country you are in, so the following information relates only to filing for bankruptcy in the UK. There are two main fees involved in filing bankruptcy and at least one of these cannot be waived, therefore filing bankruptcy will never be completely free.

Can I File Bankruptcy For Free - Court Fees

The Court Fee is currently £150, but is due to increase any time now. It is possible for the court to waive this fee for people who are on low income or claiming benefits such as Income Support. To apply for exemption from the court fee you need to use form EX160A. If you think you may be entitled to have this fee waived but are not sure, you should get in touch with the staff at the court, who will be able to give you the appropriate advice for your situation.

If you are suffering financial hardship, most of the main utility companies have trust funds which you may be eligible for. Get in touch with your electricity, gas and water suppliers to find out if they have such a scheme.

Can I File Bankruptcy For Free - Official Receiver's Fees

The biggest fee involved in filing for bankruptcy is the Official Receiver's fee, which is £360 from April 2009. This goes towards the costs of administering your bankruptcy and can never be waived. The fee is payable when you take your petition to court. The Official Receiver is the person appointed to dispose of your assets in order to raise money to pay off your creditors, and acts as your Trustee. What a treat, having to pay someone to sell everything you own!

Your trustee will deal with your creditors on your behalf, so after filing bankruptcy you will not normally deal directly with your creditors yourself any longer. The only exceptions to this are in connection with secured loans, student loan debt, overpayments of benefits, court fines and debts to utility suppliers. Any remaining debt will usually be written off at the end of your bankruptcy.

Can I File Bankruptcy For Free - Other Costs

If you swear your affidavit in a County Court you should have no other charges apart from the court fees and Official Receiver's fee. If you swear your affidavit in the High Court of before a solicitor, then there will be another small charge.

If you are filing bankruptcy as a married couple then you both need to pay the fees separately, as you cannot file bankruptcy for two people and only pay one set of fees. Similarly, if you are filing bankruptcy as partners in a business, each partner has to pay the fees separately. The exception to this is if all parties jointly apply to file bankruptcy under the Insolvent Partnerships Order.

All such fees can be paid in cash, or postal order, but not an ordinary personal cheque. The only acceptable cheques are a bank or building society cheque or a solicitor's cheque.

Can I File Bankruptcy For Free - The Bankruptcy Process

If you do need to file bankruptcy, the first thing you need is to get the appropriate forms from your local County Court. These are the Debtor's Petition and the Statement Of Affairs. Your creditors can of course petition for your bankruptcy themselves even if you do not want to file for it. Anyone to whom you owe more than £750 can do this, and would need to issue you with a Statutory Demand first.

If you file for bankruptcy it could result in you losing your home if you own it or have a mortgage on it. This can happen even if you own it jointly with someone else. Your home may even be at risk if you are in rented accommodation as some tenancy agreements do not allow for the property being occupied by an un-discharged bankrupt.

There are therefore costs involved in filing for bankruptcy and it is not possible in the UK to file bankruptcy for free. If you situation is so serious that bankruptcy is your only option, then saving up for these bankruptcy fees is probably well worth the effort.