The sequestration procedure is the same whether you apply for your own bankruptcy or a creditor petitions to sequestrate you.
During sequestration, the Scottish term for bankruptcy, assets that you hold will vest with your trustee, this means the trustee may take reasonable steps to realise the value of these assets. Any funds ingathered are used to cover the costs of sequestration and remaining funds paid to your creditors.
Your disposable income will be assessed using the common financial tool (CFT) which offsets any income in your household against all household costs to establish what, if any, level of disposable income there is. Should you be determined to have a disposable income this will be expected to be paid as a contribution for a period of four years at the end of which any debts outstanding to your creditors will be written off.
QUESTIONS & ANSWERS
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Will I lose the home if I am made bankrupt?
If you are sequestrated then your property (or your share for a jointly owned property) would vest with the trustee. This means that the trustee can register an inhibition against your property and you would be prevented from selling it. Each case is different and is reviewed by the trustee on its individual merits.
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Can I still have a bank account if I am bankrupt?
You are allowed to operate a bank account whilst sequestrated; it is at the discretion of the bank whether they wish to have you as a customer. It is unlikely that any bank you owe money to will accept you as a customer and some other high street banks may also refuse. There are now a wide variety of online banks that accept customers that are sequestrated, however, these bank accounts may incur a monthly fee.
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How much does it cost to apply for my own bankruptcy?
The current fee for standard procedure sequestrations is £200, should you meet the criteria for a MAP process then this is offered at a reduced fee of £90.
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Will I be able to keep my car?
If the value of your car is less than £3,000 you may keep it.
If the car is worth more than £3,000 and your trustee is satisfied that you require the vehicle for work purposes you may be allowed to retain the vehicle.
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Will my credit rating be affected?
Yes, your credit rating may be adversely affected for up to six years.
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