What is Bankruptcy?
Bankruptcy is designed to relieve a person from overwhelming debt and to enable a “fresh start”
The bankrupt’s assets are got in and realised by the Trustee, for the benefit of the creditors and distributions from the realisations of those assets, are made to creditors.
Bankruptcy is an Order of the Court, where either a creditor has presented a bankruptcy petition against you, or an Adjudication is made by the Official Receiver, where a debtor has made their own application for bankruptcy.
Once a Bankruptcy Order is made, that person’s assets automatically “vest” in (or belong to) the Trustee in bankruptcy, who initially is usually the Official Receiver. An Insolvency Practitioner may then be appointed as Trustee, in place of the Official Receiver, at the request of a majority of the creditors.