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So after a few years struggle with mental ill health and being in and out of work I feel I’m finally on a good path. About to finish college after completing a course I’ve always wanted to do and got a job on a zero hours contract which has enough hours for me to make money but not have to work all the time and effect my mental health.


My college course will give me the opportunity I start my own business (nothing big but an opportunity to make some sort of a living).

My one major issue is I’ve around £5k of debt which is being passed onto different companies and I feel in now ready to deal with it. Although possibly drastic I feel with what I have been through mentally over he last 3 years and with the opportunity to start my own small business it would be best for me to draw a line over these past few years and apply for bankruptcy. Any advise would be appreciated. 

Kevin Mapstone
Member Admin
Joined: 15 years ago
Posts: 4237

Hi Effy27

It's great to hear that you are feeling positive about the future.  We don't hear that enough these days!

Bankruptcy may be an option for you, but you should definitely seek advice from a reputable debt adviser first - your local authority may have a debt advice team, or your local CAB for example.  

I'm not sure how much you know about bankruptcy, but it comes with strings attached so should only be considered as a last resort really.  It will affect your credit rating quite seriously for starters, which might be a problem for someone looking to start up their own business (ie banking facilities may become problematic). 

Also, you have an obligation to pay into your bankrupt estate whatever you can reasonably afford for the next 4 years.  So it isn't as simple as declaring yourself bankrupt and walking away from the debt.  In fact, depending on what you are earning and how your business goes, it could turn out to be more expensive for you than just organising to repay your debts at an affordable rate through something like a Debt Arrangement Scheme.

Best go through your budget with an adviser first and see what you might be expected to contribute in a bankruptcy, then think about whether you still feel this is the best route for you.  If so, then they will be able to help you with your application.

Good luck with everything!

Scottish Debt Solutions Expert - Ask me for help setting up a Scottish Trust Deed or Debt Arrangement Scheme plan.