In April 2016, a new online Bankruptcy Application was introduced in England and Wales, replacing the previous process of going to court with a “petition” to become bankrupt. Instead of being approved by a judge, when you submit the Application it is checked by the Insolvency Service Adjudicator who makes the Bankruptcy Order.
As a result more people are now choosing bankruptcy. In the third quarter of 2016 there were 7% more people choosing bankruptcy than a year before, see Court-free clickable bankruptcy ‘removes stigma’.
The online application is a huge improvement on the old court forms! But it is pretty long and you may need to find some information for parts of it. There are eight parts and you can’t move from one part to the next without entering something in the current part. As a result you can’t easily look at the whole thing before you start – or when you are just thinking of going bankrupt and want to know what you might be asked.
This article looks at the new online application form to give you a feel what is involved – and there is a link to a page which looks at each section of the application.
Starting a bankruptcy application
To start a bankruptcy application, you need to supply your name, email address and answers to three security questions you select:
- if this is going to be your “real” bankruptcy application, you should choose an email address which you check regularly, as this is the address the Insolvency Service Adjudicator may need to contact you on.
- if you just want to have a look around, you can use a fake name – I have used Jane Doe to get the screenshot on this page.
You are then emailed a 12 character application number – it will look something like KZR3-HRMZ-PUMG – which you can then use to login to your bankruptcy application.
The Application Overview page
You start at the Application Overview page where you can see the status of each of the eight different sections and also how much of the bankruptcy fees you have paid so far. At any point you can go back and view the answers to the sections you have already done and edit them.
Here is a screen shot showing what it looks like when the first two sections have been completed:
The 8 sections
See The 8 sections of the bankruptcy application for a detailed look at what you need to put in each section.
When you have completed all the sections…
When you have gone through all the section you will see the above box.
Of course you may not actually have completed everything – you may still have bits to add to some sections, so it’s a good idea to keep a list of things you want to go back and add to, especially if it is taking a while to get all the information.
Once you have completed everything and paid the fees, when you click on the Submit your application you will be asked to verify some information including that:
- you are the are the person named in the application
- the information provided is accurate to the best of your knowledge
- you consent to a credit search being run using the details provided in the application.
What is this information needed for?
There are four main reasons for asking all these questionsr:
- verifying who you are. Not many people will submit a bankruptcy application and pay the fees for someone else maliciously, but the Adjudicator is going to want to spot this if it happens!
- getting the Adjudicator the information needed to decide if your bankruptcy order should be made or (very unlikely) your application should be rejected. If you have lived abroad until recently and most of your creditors are abroad, the Adjudicator will consider whether England and Wales is the right place for you to go bankrupt. The Adjudicator will look at a summary of your assets, debts, income and expenses to see if you are “insolvent” – if you are worried about whether you are, the best thing you can do is take some good debt advice before submitting your form.
- getting a full picture of your personal and business affairs. After your bankruptcy order is made, the details are passed to your local Official Receiver’s office who will interview you about these. A few people try to conceal assets, debts, businesses they have been involved with, the fact they transferred their house into their wife’s name two years ago etc. The only way for the OR to spot the people who are deliberately doing this is to ask everyone a lot of questions.
- getting a fair picture of your expenses The details of who lives with you and how old they are will help the Official Receiver later in trying to decide if an Income Payments Agreement is required.
Help – I don’t have some / a lot of this
Many people won’t!
Apply a bit of perspective for old stuff. If you opened your main bank account in the late 90s and don’t have any documentation saying when, just put down Jan 1997 as the date it was opened the account, the OR isn’t going to care. Of course your bank could probably tell you the information if you phoned them up – it would be worth doing this if the event was much recent.
The OR will also be used to dealing with people who haven’t kept details of everything for the past 5 years. You may have moved house a lot, separated from a partner, have been out of the country, had mental health problems or just not be very good at filing paperwork… Self employed people who are going bankrupt because their business has failed often don’t have perfect business records.
Just do your best to fill in the application and make some notes about any areas where you really weren’t sure what to put down and mention them to the Official Receiver at your interview.
Problems using the application
If you find you can’t start the next section on the main Overview page, it’s probably because there is a question in the previous section you haven’t yet answered.
This is a new application and it’s always possible there are some bugs in it. If you have problems, you could call the Insolvency Service on 0330 331 0020 or email them at email@example.com .
When will your bankruptcy start?
When you have paid the fees and submitted your application it goes to the Adjudicator’s Office. They aim to approve 95% of applications within 2 working days.
UPDATE: June 2016 Anecdotally most “routine” applications – those where there is no concern about jurisdiction (should you be going bankrupt in a different country?) or whether you are insolvent – are being approved in this timescale, with many being approved the next working day.
You should check your emails regularly – it is possible the Adjudicator may want to ask something (but this will be rare). When the adjudicator has made the decision, you will be informed by email.
You can check if your application has been accepted by logging into the application – if the application has been approved, there will be a copy of your Bankruptcy Order and its date – this is the date you bankruptcy starts.