Pure Financial Management,
Nortonthorpe Mills
Scissett
Huddersfield
HD8 9LA

Tel: 0844 855 0 225
Fax: 0844 855 0 229

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Bankruptcy

This is always a last resort if you are in serious debt and no other debt solutions such as an IVA or debt management plan will help.

It protects you from your creditors and allows you to start afresh but you need to think about it carefully first.

A Statutory Demand is a formal document which can be issued to a debtor who has loan repayment arrears. This is the first step of the legal process a creditor may use to obtain a court order to get you to repay your debt.

If you do not repay your debts on time, your creditor may use the power of the courts to get you to settle the debt or start making reasonable payments.

A creditor has the option to try to bankrupt you, with a statutory demand being the first step of that process.

A Statutory Demand requires you to settle the outstanding debt by either:-

• Pay monthly/weekly payments
• A lump sum
• Secure it against a property or other assets.

Within 18 days of receiving a Statuary Demand, you may apply to your local County Court to set it aside under the following circumstances:

• The amount of money owed is in dispute
• The debt is not payable now.
• You are prepared to secure the debt to the creditors satisfaction under the creditors stated terms.
• The amount owed is less than £750.
• The statutory demand has been issued in error or does not comply with rules.
• You can and are about to repay the debt.
• You have a counterclaim of more than the money owed.

Ignoring or failing to comply with a Statutory Demand entitles the creditor to present a petition for bankruptcy 21 days from the date of issue.

Some companies use statutory demands as a scare tactic. They know that when someone is unable to repay a debt, they generally have more than one debt and that whoever shouts loudest tends to get paid first. However, you should always take a Statutory Demand seriously.

If you have received a Statutory Demand, or have been threatened with one, then please call us for advice. You will have more options to repay your creditors than stated in terms of the demand.

see also IVA

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