Posts Tagged ‘Debtor’

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How Bankrupts In The West Get Clear Of The Debts

Saturday, June 5th, 2010

For all financial history of mankind it has been made up only two ways to work with bankrupts. One – to sell property of the debtor and to divide the gain between the creditors. A rather fast way and reliable, but not the most effective. Another – to try to agree with the debtor and to allow it to delay debt payment.

Bankers and other creditors perceive this procedure unequivocally: that the blessing for the debtor, – is that bad of the creditor. But, if to judge by experience of many western countries, creditors can receive during such “rehabilitation” much more, than on property sale. Though for this purpose it is necessary to trust both to the debtor, and his health, and law-enforcement system which if something happens will interfere and will call the defaulter for responsibility.
Both variants have pluses and minuses, and “preferential” procedure of rehabilitation though it is claimed among debtors, on popularity still is far from the traditional variant.

It is popular – to agree

In Britain the run into debt citizens have some variants to agree with the creditors. The most widespread – is so-called “the individual voluntary agreement” (IVA), or the plan of payment of a debt confirmed by the court. To take advantage of it, the debtor should find the manager (usually the lawyer or the bookkeeper) and to agree about fee with him. The managing director – approximately the same as and at traditional procedure of bankruptcy, – co-ordinates arrangements with creditors and then watches the debt payment. He does not confiscate the property of the debtor, and if sells, only that part about which all participants have agreed.
There are the procedures of the agreement with creditors in many other countries, but British – is hardly probable the most liberal. In States, for example, these rules extend only on debts to 336 000 dollars (to 1 million dollars if it is a question of credits on the security of property), and in Canada where the procedure is called consumer proposal, – to 250 000 dollars.
For British people there are restrictions either in the sum, or in time: in the USA it is necessary to re-structure a debt within 3-5 years, in Germany – within 7 years, and in Britain – as you will agree with creditors.

It is possible even to enter into the agreement in Britain at any moment – both before the recognition of the person as the bankrupt, and after (the truth is that , in the second case there is less than flexibility at definition of payments). The main thing that you did not undergo through this procedure is last year. In Germany, on the contrary, bankruptcy process is considered to be as stage-by-stage activity: in the beginning the debtor should try to agree with creditors extra judicially, then with the help of the court and if it is impossible, then the standard procedure of bankruptcy begins.

Re-structuring procedure imposes certain restrictions. To agree, a certain free income is necessary for the debtor . As a rule, the agreement is counted this way, so that the creditors would receive more than at simple sale of property. The fact of such agreement, as well as the bankruptcy fact, should be reflected in a credit history (in Britain – 6 years, in the USA – 10 years). In Australia a person who has entered into the agreement, gets into to the state database for ever.

There are also certain restrictions on business activity. The American recognized as the bankrupt on this procedure (chapter 13 of the law on bankruptcy), cannot take credits without the court consent.

In Australia without the sanction of the court the debtors are forbidden to supervise the business.

British and here have become first: the debtor can take credits or supervise over the companies (though creditors under the agreement can forbid it).

Re-structuring of debts –is a popular procedure. Over the last ten years in Britain the number of wishing to take advantage of it has grown in 5 times, and about of 40 % of the procedures of an inconsistency are looked under these schemes, and in States – about third.

Practically all of us remember the times when one could easily buy something even if one had not enough funds. Loan was a simple way out. It is not surprising that now many of those who applied for a credit, are searching for how to avoid bankruptcy.

Those people who happened to get into the situation when their expenses exceed their earnings, definitely have to search for ways to avoid bankruptcy.

If facing such difficulties it is wise to use any means to get over it. Use such unique opportunity as the Internet technologies. Using them at full capacity might give great results. Working with search engines, forums, social networks,web sites one can learn many tips to avoid bankruptcy and a great deal of other important info. Also signing up for RSS feed on this blog will assist to keep track of new publications and tips on the topic.

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Bankruptcy. Forms And Methods. Historical Facts. Part I

Saturday, June 5th, 2010

The world Organization of Labor specifies that the debt slavery continues to exist and nowadays in India, Pakistan, China, many states of Africa and Latin America. For example, in Niger similar practice has been recognized to be illegal only in 2003 — by then up to 8 % of the country population was in debt slavery, and in many cases grandsons and great-grandsons continued to pay the debts made by their grandfathers and great-grandfathers. In India up to 40 million persons are in such dependence. Often enough unlucky debtors went to prison. In the USA this practice has been cancelled on the federal level only in 1833, in British Empire — in 1869 (nevertheless, the inaccurate debtor could be sentenced to imprisonment for the term of up to six weeks). It is little-known that the modern American state Georgia was initially created, including, for the purpose of resettlement on these lands the poor debtors from English debt prisons.

In medieval Russia traditional “beating back” — in the literal meaning of this word — debts was such procedure unpleasant for the debtor as ‘pravegeue’ . The accused was tied to a column on a market square and was beaten by sticks on calves of feet until he agreed to liquidate a debt. Such process of collecting of a debt could proceed long time as the main terminator here was firmness of the subjected going under execution. The duration of ‘pravegeue’ depended and on a required amount of debt. Usually for 100 rubles the debtor was on ‘pravegeue’ for a month. The object of the execution was as the respondent, as his guarantor, or people dependent on the respondent (peasants and lackeys).

The principal kind of punishment of the borrowers during New time was the debt prison. In Russia it is known from time immemorial and has existed up to 1917. Its inhabitants included even the celebrities. For example, the known literary critic and poet Apollo Grigoriev (1822—1864) has visited in his time this gloomy place, and not only one time: once in 1861 and two times in 1864. A known portrayer of ordinary life Moscow Vladimir Giljarovsky (1853—1935) has described debt prison as a place which inhabitants were sympathized even with its security guards. Moreover, there was a way of especially refined mockery at prisoners of the debt prison (the hole) from outside creditors. As, the prisoners were kept at the expense of their accusers there were situations when the last stopped to pay their supplies and those joyfully came back home. However, this pleasure was premature. As soon as the debtor got a job and started to receive the income, he was again brought to the places “not so far away” as the prison administration received the means for his further supplies.

Practically all of us still remember the times when one could easily buy a thing even if one hadn’t got enough funds. Credit was a simple way out. It is little wonder that now many of those who applied for a loan, are searching for how to avoid bankruptcy.

Those people who happened to get into the condition when their expenses exceed their earnings, definitely have to look for ways to avoid bankruptcy.

If facing such difficulties it is wise to use any ways to get over it. Avail yourself of such unique opportunity as the web technologies. Using them at full capacity might give great results. Making use of search engines, forums, social networks,web sites one can find lots of tips to avoid bankruptcy and a great deal of other respective info. Also subscribing to RSS feed on this blog will help to be aware of new publications and tips on the topic.

Related Blogs

  • Share/Bookmark

Posted in Credit Card Debt Help | Tags: , , , , , , , , , , , , , , , , , , , , , , , ,  | No Comments »

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