Effects of Bankruptcy
Bankruptcy will affect you in 2 ways, financially and emotionally. It is a big step to file for bankruptcy and it can have a serious effect on your mental state during the process. It will also affect all financial matters in your life for a number of years. You will also lose control of all of your assets.
The effects of bankruptcy can cause depression due to the time it takes for all problems to be sorted out. There will be time away from family and your job and this will put a great amount of stress into your life. The financial effects of bankruptcy will also add extra stress to your life.
If you don’t have a job, it will be harder to get one, as most employers look at your credit rating to see how responsible and stable you are. You may need to convince an employer that you are the right person for the job and that this is a new start for you. That apart from a bad credit you can be responsible and work hard.
Any business transactions will feel the effects of bankruptcy as there are situations that you aren’t able to be involved with or that have conditions put on them. You will not be allowed to be a company director and you cannot trade under a name that is not your own unless you let all parties involved know about your bankruptcy status. You are unable to have control over the formation of a company, or promotion of a company without gaining permission from the court first. In some instances you will not be allowed to be a Justice of the Peace or become a member of any government. You are also unable to act as a Chartered accountant and a lawyer, if these are your chosen profession.
Another hidden effect of bankruptcy is to do with insurance premiums. You are now considered as a risk and most policies will have an increased premium. This doesn’t make much sense as your finances are limited anyway, but greater risks pay higher premiums.