Katie Price, previously known as Jordan, has hit the headlines again recently with her current financial woes. Following her Individual Voluntary Arrangement (IVA) proposal which was accepted late last year, in which she was to make monthly payments of £12,000 to her creditors, it appears that Katie was unable to keep up with the plan and so bankruptcy proceedings were brought against her.
Following a hearing on 26 November 2019 at the Insolvency and Companies Court in London, which neither Katie nor any representatives on her behalf attended, she was declared bankrupt under her full name of Katrina Amy Alexandra Alexis Price.
The downturn in her fortune has been dramatic with it being suggested she was once worth around £45 million. Her creditors include HMRC and former husbands and her debts are made up of missed mortgage payments, creditors for services such as beauty treatments and surgery, County Court Judgments, private school fees and costs associated with running a farm and keeping horses.
An IVA is a legally binding agreement between a debtor and their creditors to see debt paid back at an affordable rate over a number of years. However it appears Katie missed the agreed payments and the IVA failed. Bankruptcy proceedings means the Official Receiver will take control of Katie’s finances and assets and may look at selling them off – it appears her assets include her property, vehicles and her various farm animals.
Katie will be discharged from the bankruptcy automatically on 26 November 2020 however her credit record will be impacted and the bankruptcy will remain on file for at least 6 years. She could also find restrictions being placed on her.
IVA’s offer a positive way out of debt for many people, so long as they are set at attainable levels and the debtor continues to pay into them as required. However given Katie’s recent spending, it appears that the Price was not right.
For information about our personal insolvency and bankruptcy services, contact Natasha Biggs.