Insolvency is something that few people want to talk about but there are many who need to know the in’s and out’s of the term in order to avoid becoming a figure in the insolvency statistics.
Asking questions is the only sure-fire way to ensure that insolvency isn't likely to darken your door and ruin your company's chances for success.
Insolvency – FAQ's To Avoid IOU's
There are many questions regarding insolvency both in terms of what it actually is and how to avoid it. Here are some of the most pertinent:
Insolvency Question 1 – What Is Insolvency?
This is the key point. Insolvency is not the same as bankruptcy. The term insolvency refers to the stage when a business or persons assets no longer continue to exceed their liabilities.
Insolvency Question 2 – What Are The Long Term Effects Of Insolvency?
In terms of a business, insolvency will generally mean that the company ceases to trade. Some companies, however, can be saved from insolvency by going into a period of administration. Where individuals and insolvency are concerned, you will find that your credit rating is badly affected and you may struggle to get credit. Another consequence of an individual experiencing insolvency is that the may be charged higher interest rates.
Insolvency Questions 3 – What Effect Does Insolvency Have On Employees?
If a business experiences insolvency then it is likely that the employees will be made redundant. In some cases a company can go into administration which may cut down on the number of redundancies and see the company continue to trade to some degree.
Insolvency Question 4 – Can Someone Who Is Insolvent Still Trade?
Those who experience insolvency are still entitled to earn a living by being self employed or running a business. However, after insolvency you must not disobey the law of obtaining credit of £500 without disclosing your insolvency.
Talk To Varden Nuttall About Insolvency
Varden Nuttall has been established for over 15 years and is dedicated to helping people in financial difficulty find a debt management solution through an Individual Voluntary Arrangement (IVA). Employing 90 people, including trained and skilled IVA administrators, we are one of the largest IVA companies in the UK and handle over 3% of all IVA applications. To find out more about the company, or to make an appointment to talk about putting an IVA in place, call us today on 0800 031 9802 or fill in our online enquiry form.