Private bankruptcy
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Private bankruptcy – what now?
When the burden of debt becomes unbearable and you no longer know how to repay your debts, then it is the right time to consider private bankruptcy.
When is the right time for private bankruptcy
Individuals (regardless of whether they ran the company or not) are ripe for private bankruptcy if they are insolvent or if they are permanently unable to repay their debts. If this happens, you should submit a request to initiate the process of debt settlement (this is just the name for the bankruptcy procedure on the property of individuals, which is also called a private competition).
Out-of-court settlement
Individuals who are not involved in a business must make an out-of-court settlement attempt before initiating personal bankruptcy, in order not to incur a cost advance. For this, each creditor must be proven to make the offer of payment of a certain quota. If a creditor refuses, the debt settlement procedure can be initiated without any cost advance for the costs of the proceedings (representation costs are not included!).
Payment and repayment plan – ways out of the crisis
The debt settlement process is one way to free you from your debt. Of course, not in vain. In the debt regulation procedure there are – briefly summarized – the following possibilities:
With a payment plan
• You offer your creditors a quota, payable either immediately or in installments (up to 7 years).
• In practice, the minimum ratio corresponds to your earning units that are likely to be attached over the next 7 years. If the creditors accept the payment plan, they will be debt-free after they have been fulfilled (7 years)..
• During the term, you live your life as normal. But before it can be voted on the payment plan, your entire assets must be utilized (as far as it is not evicted), eg a car, an apartment, a house, etc.
If no payment plan succeeds, you still have the levy procedure:
• The attachable part of your income is split over 5 years to the creditors.
• Within these 5 years you have to fulfill various duties, in particular you have to work or try to work.
• In addition, any assets that they receive during this time (such as inheritance or donation) issue.
• If you have good behavior, you will receive from the court after 5 years, the residual debt exemption.
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