Insolvency: what happens the day after the opening order

People who receive an order opening proceedings often feel the first relief in a long time. Collection stops, and the calls from creditors end. That relief is real. But the proceedings are only beginning, and the next stage calls for order.

What changes at once

With the opening order, collection and enforcement proceedings against you are stayed, and creditors file their claims within the insolvency case. A trustee is appointed to examine your financial situation and recommend a repayment plan. The court or the Official Receiver sets a monthly payment you will make throughout the interim period.

What is expected of you

• Pay the monthly payment in full and on time, every month.
• Submit the periodic reports on income and expenses, with the required documents.
• Cooperate with the trustee: attend meetings, hand over documents and answer questions.
• Report any material change: a new job, an inheritance, a change in the family.
• Do not take on new debts you cannot pay.

When something goes wrong

Life does not stop during the proceedings. You may lose a job, fall ill, or become a parent. In such cases you can ask to change the monthly payment, with a reasoned application and documents. What you must not do is quietly stop paying or reporting. Repeated defaults can lead to an application to cancel the proceedings, and then collection resumes.

Where it all leads

At the end of the interim period the trustee files a report, and a repayment plan is set on that basis. Those who keep to the plan receive a discharge at its end: the remaining debts included in the proceedings are erased. Some debts, child support for example, are not. It is worth knowing that from the start.

If you are already in proceedings and something feels unsteady, it is better to deal with it now than after a warning letter arrives. I know the process from the inside, and I would be glad to go through your file with you.

This letter is general information, not legal advice. Every case is different, and the law changes from time to time. Before acting, it is worth taking advice on your own circumstances.