There is a fresh warning that people considering bankruptcy should be fully aware of the consequences.
Recent statistics from the Insolvency Service have shown that the number of bankruptcies in the UK has increased by over 73 per cent in just one year.
Now credit agency Experian is setting out to remind people about the cost of being declared bankrupt.
Experian has released a guide aimed at ensuring that those who are considering bankruptcy are in possession of all the facts.
"Bankruptcy is not an easy way out of debt. It may be the best option for some people, but it should only ever be considered as a last resort and after receiving professional advice. It is rarely a positive solution to money problems," says Jill Stevens, director of consumer affairs at Experian.
"Becoming bankrupt will probably mean you have to give up any valuable possessions you own. Even after your bankruptcy has been discharged, organisations may refuse you credit or other financial services simply because you have been bankrupt in the past; if you do manage to find someone who will lend to you, they are likely to charge you a higher interest rate as you will be considered a high-risk customer.
"Going bankrupt can also affect your chances of renting a home or getting the job you want," adds Ms Stevens.
Life after bankruptcy can be very different and it is by no means a quick-fix solution.
"A bankruptcy order will appear on your credit report for a minimum of six years from the date of bankruptcy. In serious situations where individuals are deemed to have acted fraudulently or recklessly, a Bankruptcy Restriction Order may be applied and that can last for up to 15 years," says Ms Stevens.
If you are considering bankruptcy as an option, it is advisable that you seek independent financial advice.
