Making the decision to enter into bankruptcy can be a tough one – no matter whether it’s a decision prompted by you or your creditor. The term of your bankruptcy should finish within 12 months (although some can last longer) and once it ends, you’ll be deemed a ‘discharged bankrupt’.
You’ll probably want to start afresh once your bankruptcy comes to a close, and one of the most obvious first steps in doing this is to open a bank account. But will you be able to get one if you’ve recently been discharged from bankruptcy? Here are your options.
When entering into bankruptcy, any accounts that you have will be frozen. The decision on whether to keep your account open during the period of your bankruptcy falls on your bank – in most cases, you’ll need to look into opening a new account once you’ve been discharged.
But this can prove tricky, as your bankruptcy (like other debt solutions) affects your credit rating for up to six years, so you might consider opening a basic bank account. In case you’re unfamiliar with what a basic bank account is, it’s an account that doesn’t come with an overdraft facility or minimum monthly payment, which makes it more suited to people with a bad credit history.
Whilst there is usually a credit check when you apply for a basic bank account you should still be able to get one even if you’ve had credit problems in the past. However, you may still have problems if you have been bankrupt or if you have criminal convictions of fraud against their name. Basic bank accounts are not just available from high-street banks – they’re available from building societies and credit unions as well.
But a basic bank account is not your only option. There are other accounts that you could be accepted for, like the thinkmoney Personal Account.
thinkmoney Personal Account
The thinkmoney Personal Account is a budgeting account that helps you manage your money better, no matter your situation. The account is an alternative to a basic bank account and works by separating the money that you need for your monthly commitments from your everyday spends.
To apply for the account, you just have to be 18 or over, a UK resident and able to provide us with proof of identity. We don’t do any credit checks on applications, so if you’re currently in the middle of bankruptcy (or other form of insolvency) or are fully discharged, this won’t count against you.
The account comes with a monthly management fee of £17.50 (£24.50 for joint accounts) and you won’t be charged for any missed or late payments. You can read more about the account and its features here.