Insolvency Disputes (Bankruptcy)
Our Civil Litigation Solicitors in Coventry and Warwickshire regularly advise on disputes arising out of personal insolvency, including bankruptcy, Individual Voluntary Arrangements (IVAs) and Debt Relief Orders.
We have one of the most successful and busy civil litigation practices in Coventry and Warwickshire. Being embroiled in an insolvency-related dispute is extremely stressful, as in the initial stages you are unlikely to know when or even if you will be paid. If you are facing personal bankruptcy, considerations such as being able to keep your family home and earn an income will play heavily on your mind. What we do best is take the matter off your shoulders and utalising our expertise to devise a winning strategy to settle the dispute as quickly and cost-effectively as possible.
We are a diverse, multi-lingual law firm with offices based in the centre of Coventry, that uses best-in-class technology to provide clients with streamlined, modern, and highly effective civil litigation advice and representation. Our many years of experience means we have a robust reputation for excellence with the UK’s best Barristers and Queen’s Counsel , forensic accountants, industry experts, insolvency professionals, and budget advisors who will, when needed, bring additional support to our Coventry and Warwickshire based Civil Litigation Department. Our clients also benefit from our ability to instruct the country’s most respected expert witnesses.
Below are some of the most common questions we are asked about insolvency disputes concerning individuals.
What is bankruptcy?
A person can be declared bankrupt if they are unable to pay their debts or they have broken the terms of an IVA (see below). Bankruptcy can be voluntary, or a Creditor can make an application to the Court if they are owed £5,000 or over. If the Debtor has broken the terms of an IVA, an Insolvency Practitioner can make a bankruptcy application.
The bankruptcy process has significant consequences for the Debtor. With limited exceptions, most assets and property will be sold by a Trustee to pay Creditors. An obligation to make debt-related payments from personal income will last for three years. Furthermore, being declared bankrupt can haunt a person’s reputation for many years.
Our Bankruptcy Solicitors have successfully defended numerous bankruptcy applications. This is a specialist area of legal work and one that our Coventry based team excels in.
How does an Individual Voluntary Arrangement (IVA) work?
An IVA is a bankruptcy alternative. It is essentially a contract between the Debtor and their unsecured Creditors to either:
- Settle any outstanding debts by paying a proportion of them as a full and final settlement, or
- Arrange for the Creditors to be paid over time, perhaps with the Debtors property and assets being controlled or held in trust for the benefit of their Creditors.
Debtors will need to use their income, assets, or both to fund debt repayments. Third parties such as family and friends can also contribute to paying Creditors.
To create an IVA Creditors holding 75% or more of the debt must give their approval. The IVA’s terms will bind both the Debtor and their Creditors. Secured Creditors, such as a mortgage lender will normally remain outside of the IVA and their rights cannot be affected by the agreement without their consent.
Will I lose my home if I am declared bankrupt?
If you go into voluntary bankruptcy or the Court declares you bankrupt the Official Receiver (the person who deals with your bankruptcy, may sell it to release funds to pay your Creditors.
You can avoid losing your home by selling your beneficial interest in the property (the value of your share of the property less any loans and/or mortgages) to your spouse or another family member.
Our Bankruptcy Solicitors in Coventry and Warwickshire can advise you on keeping your home if you become bankrupt. It is important, however, that you contact us immediately so we can best assess your situation and advise on the options open to you.
Why choose us?
People choose and recommend us because we get results and in a majority of cases settle disputes outside of Court. Our Solicitors will take care of your case, ensuring you understand the options available and get the advice you need to protect your best interests.
Insolvency disputes are stressful for both Debtors and Creditors. Our Personal Insolvency Dispute Solicitors have the expertise required to rapidly get to the heart of the dispute and advise on a resolution process best suited to your case. As a law firm, we are responsive and proactive, and ensure our clients are always kept informed as to the progress of their matter. You can trust us to use our technology and sheer intelligence to resolve your dispute so you can move forward.