Please find below the definition for bankruptcy and related terms.
Bankruptcy is a legal process that a debtor or creditor can initiate, and become subject to, for the settling of outstanding debts. In England and Wales, it is applicable to individuals only.
Personal insolvency is the inability of a debtor to pay their debts as they fall due.
The Commencement of bankruptcy is the date at which the bankruptcy order is made. Bankruptcy continues until discharge.
Bankruptcy discharge is the process by which the debtor is no longer bankrupt. The bankruptcy debts not preserved will be discharged and the restrictions of bankruptcy will be lifted, save for any order or undertaking in force.
A debtor is an entity who owes money.
A creditor is an entity who is owed money.
An asset is property of some value that an individual owns. In bankruptcy a debtor's assets are collectively known as the bankruptcy estate, which is defined by the Insolvency Act.
A liability is money owed by the debtor.
The bankruptcy estate is all property belonging to or vested in the bankrupt at the commencement of bankruptcy. Provisions of the insolvency act excluded certain property.
Property includes money, goods, things in action, land and every description of property wherever situated and also obligations and every description if interest, whether present or future, vested or contingent, arising out of or incidental to property.
Bankruptcy debts are defined as any debt or liability to which the debtor is subject at the commencement of the bankruptcy. The definition is extended to include any debt or liability that the bankrupt may become subject to after the date of commencement by reason of any obligation incurred before the bankruptcy. Some bankruptcy debts will survive bankruptcy. Pre-bankruptcy interest is a bankruptcy debt.
A bankruptcy order is an order by the court that the individual debtor be adjudged bankrupt.