Experian warns of bankruptcy consequences

The organisation has released its Credit Report Basics guide, which highlights the little-known negative implications of bankruptcy.

For example, the guide points out that not only will the consumer in debt have to give up possessions of worth but could also find future access to financial services denied.

Even if the person does manage to obtain credit, it is likely to be at a far higher rate of interest as the bankruptcy will associate the borrower as a high risk customer.

The bankruptcy order will remain on the consumer’s credit report for at least six years, which could even have the impact of hindering plans to rent a home or attain certain jobs.

Jill Stevens, director of consumer affairs at Experian, said: “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.”