Pros & Cons of Minimal Asset Process
Minimal Asset Process is a form of bankruptcy available to those who can’t afford sequestration and who have no assets to be sold. While it has many advantages, including that it allows you to pay off your debts quicker than other debt solutions, there are also other factors you should consider when deciding whether MAP is the right debt solution for you.
For example you will be added to a public register and your credit rating will be affected. We’ve listed all the pros and cons below so you can get a better idea< of how MAP bankruptcy will affect you.
If you are interested in MAP bankruptcy or would like advice about what debt solutions might be available to you, get in touch with PayPlan. We offer free advice and will be able to help you regain control of your debt problems.
Advantages of MAP Bankruptcy:
- Legal action is stopped
Once you have entered into the minimal asset process, you don’t have to worry about your unsecured creditors taking legal action against you as they are prevented from doing so.
- Fixed time period
MAP normally lasts 6 months so as long as your circumstances don’t change during this period, you can rest assured you will be debt free after this.
- Debt write-off
Your debts will be written off upon completion so in six months you could be completely debt free.
- Low set-up fee
- Frozen interest and charges
The total of your debts won’t increase as your creditors are not permitted to add further interest or charges.
- Easy to set up
After your discussion with a money advisor, it is fairly easy to complete the forms and enter MAP.
Disadvantages of MAP Bankruptcy:
- Restrictive Criteria
Not everyone can enter MAP – there is a tight criteria you must meet. For example, you need to owe between £1,500 and £17,000 and to have little income or assets. You can find out more by visiting our MAP page.
- Register of Insolvencies
Your bankruptcy will be recorded on the public Register of Insolvencies for 5 years.
- Credit rating
Although MAP could be over within 6 months it will still show on your credit rating for a period of six years.
MAP could affect your job if your company requires you to undergo a credit check. This is normally only the case for financial industry jobs.
You can also not act as a Director of a Limited Company for the duration of the MAP.
Even though you may not have many assets if you enter MAP, it’s likely that any valuable assets will need to be sold, to go towards repayment of your debts.
If you are struggling to repay your debts, get in touch with PayPlan. We offer FREE debt advice and our advisers will be able to talk you through a wide range of debt solutions so you know what options are available to you.