Sometimes referred to as a MAP, find out more information here
The minimal asset process (MAP) is a way of applying for bankruptcy which is aimed at people on a low income with very few or no assets. It’s a means of writing off debt that you would struggle to repay within a reasonable time. You must pay a fee of £90 to apply for MAP bankruptcy. There are no exemptions or reductions available. You’ll also need to get advice from an approved money advice organisation such as STEPCHANGE. You won’t be able to apply without doing this first.
QUALIFYING CRITERIA
You must live in Scotland, or have lived in Scotland in the last 12 months.
Your debts are more than £1,500 but less than £17,000.
Your car is worth £3,000 or less.
Your other assets are worth less than £2,000 in total, with no single item worth more than £1,000.
You’re not a homeowner.
You haven’t gone through sequestration, which is bankruptcy in Scotland, in the last five years.
When it comes to your income, there are two ways you can qualify:
Your income is made up solely of income-related benefits such as jobseekers allowance (JSA).
There’s no money left over from your total earned income once all your essential living costs are paid.
COSTS
Fees: Before your application is submitted the fee of £90 must be paid in full. The fee can be paid in one lump sum or in installments over a 6 month period. Once your fee has been paid and your application is submitted you can’t get your money back, even if the MAP is rejected or revoked.
ADVANTAGES
You’ll normally be discharged from your MAP bankruptcy after six months, and most debts will be legally written off at this point.
Once your MAP is approved your creditors won’t chase you for payment or add more interest and charges to your debts, and they can’t take any court action.
It costs £90 to apply for. This is payable to the Accountant in Bankruptcy.
Although MAP bankruptcy is a formal legal process, you won’t need to appear in court.
RISKS/DISADVANTAGES
Your credit rating will be affected for six years, starting from the date your MAP bankruptcy is awarded.
Your bank is likely to close or freeze your bank accounts. It’s likely you’ll only be able to get a basic bank account.
Bankruptcy can lead to disciplinary action or dismissal in some jobs.
Some private landlords may evict tenants if they become bankrupt. Check your tenancy agreement.
Job: MAPs may affect some jobs if the employment contract specifies that you can’t be insolvent. This is most likely to be an issue in the finance and legal sectors, but other jobs may also be affected. In our experience this is not common.
Cancellation: The official receiver can terminate the MAP if they discover you intentionally misled them in your original application.
It’s your responsibility to inform the official receiver of changes in your circumstances. It’s an offence to give away or hide assets from the official receiver and you must co-operate with the Insolvency Service if they ask you to provide information.
Not complying with the restrictions (see below) can be deemed as committing an offence, which could lead to a fine or in rare cases imprisonment.
OTHER INFORMATION
Restrictions: You must not,
Take out credit over £500 without telling the lender you’re on a MAP.
Carry on a business under a different name without revealing your previous business was subject to a MAP.
Set up a limited company or act as a company director without permission from a court.
If you live in private rented housing or you have rent arrears, your landlord may evict you.
Once you’re discharged, after six months on MAP, it will take a further six months to finalise everything. During this period, you’ll still be under certain restrictions, For example: You cannot borrow more than £2,000, either solely or jointly, without telling the lender that you’re bankrupt.