Bankruptcy debt and demands
If you cannot pay your debts you may go bankrupt or be made bankrupt. This is following the service of you of a statutory demand for your bankruptcy or an unsatisfied judgment followed by a sheriff attempting to seize your goods.
If you go bankrupt the official receiver takes over. It is important that you are completely truthful with him and not to is a criminal offence. If you are in difficulty with bankruptcy then look at www.gov.uk/bankruptcy or www.nationaldebtline.org or www.stepchange.org.
If you are served with a statutory demand you can apply to have it set aside if you have a set off i.e. he owes you more money than you owe him, or you have grounds e.g. the debt is not due.
Also if the creditor has security e.g. a second charge on your house or a Charging Order. He cannot have both and has to elect.
You have to defend either on the grounds that the money is not due or for some procedural reason.
Expert legal advice is essential. The notice talks about 21 days but in fact you only have 18 days to apply to have it set aside or you go bankrupt.
If a petition is filed even if you later have it set aside or annulled the damage to your credit rating can be horrendous and lifelong.
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