Gambling debt can be included in Bankruptcy. However there are implications that you need to be aware of.
Included in this article:
- Is Gambling Debt included in Bankruptcy?
- Will the length of your Bankruptcy be extended?
- Do you have to prove you have stopped Gambling?
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Is Gambling Debt included in Bankruptcy?
The fact that you have gambling debt does not stop you from going bankrupt. You can still use this solution. The debt is included in the same way as any others that you owe.
You will be asked whether or not you have lost any money through betting or gambling in the last two years when you fill out your application form. If you have then you must be honest.
Even if all your debt is due these reasons you will not be rejected. The Adjudicator who reviews your application is not normally interested in the reason for your debts.
If you have gambling debt be honest about it in your bankruptcy application. It is likely to come to light later anyway and the fact that you did not mention it will reflect badly on you.
Is the length of Bankruptcy extended if you have Gambling Debt?
The standard length of Bankruptcy is 12 months. After this time you are normally discharged. However if you have gambling debt the Official Receiver (OR) might ask you to accept a Bankruptcy Restrictions Undertaking (BRU).
A BRU extends the time that some of the restrictions of Bankruptcy have an affect on you. This may seem worrying. However in reality the implications of a BRU for most people are minimal.
If only a small amount of your debt is due to gambling it is very unlikely that you will get a BRU. But it does become more likely as the percentage goes up. It is extremely likely that you will get one if all of your debt is because of gambling.
If you have gambling debt it is by no means certain that you will get a BRU. It depends on the percentage of your due which is down to this reason and whether the OR believes it is appropriate.
Do you have to prove you have stopped Gambling?
It is not necessary to stop gambling before you apply for Bankruptcy. However it is by far the best thing to do.
If you have already stopped the OR will have more confidence that you will not get back into problems in the future. Ideally you should aim to show three months of bank statements with no gambling transactions.
You should take advice from an organisation such as Gamblers Anonymous or GamCare. This will help prove that you are committed not to gamble again in the future.
If you are still gambling you then risk getting into more debt after you have gone Bankrupt. Any new debt you incur after the date of your bankruptcy is not included. You will be liable to pay it.
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