Can I get rid of my debts in the insolvency process?
July 6, 2024 | 40,00 EUR | answered by Katja Winterberg
Dear Insolvency Lawyer,
I am currently facing a very difficult financial situation and am unsure about how to proceed. My name is Marco Freudenberger and I have accumulated high debts that I simply cannot afford to pay anymore. The reasons for this are a prolonged period of unemployment and unexpected medical expenses that have put a heavy strain on my financial situation.
I am currently in the insolvency process and I am wondering if there is a possibility to actually get rid of my debts through this process. I am very worried about what my financial future will look like and if I will ever be able to get back on track.
Could you please explain to me if and how I can actually get rid of my debts within the insolvency process? Are there specific requirements that I need to fulfill in order to benefit from this process? Are there perhaps alternative solutions that I should consider?
I would greatly appreciate it if you could provide me with some clarity on this matter, as I am currently finding it very difficult to keep track and make the right decisions.
Thank you in advance for your assistance.
Sincerely,
Marco Freudenberger
Dear Mr. Freudenberger,
I understand your concerns and the uncertainty that comes with a difficult financial situation. In insolvency law, there are indeed ways to get rid of debts and make a fresh start. In the following, I will explain to you how the insolvency process works and what requirements you must meet to benefit from it.
The insolvency process is a legal procedure that allows a person to clean up their debts and make a new economic start. There are different types of insolvency proceedings, but in your case, the consumer insolvency procedure (regular insolvency or consumer insolvency) would likely be relevant.
To get rid of your debts within the insolvency process, you must file for insolvency. This can be done either by yourself or by a creditor. After the application is filed, an insolvency administrator is appointed to oversee the administration and distribution of your assets. During the process, you must disclose all information about your financial situation and follow the instructions of the insolvency administrator.
Depending on the type of insolvency procedure, there may be different requirements that you must meet. For example, in the consumer insolvency procedure, you must prove that you are unable to pay and that an out-of-court settlement attempt has failed. Furthermore, you must commit to assign your attachable income to the insolvency administrator to satisfy your creditors.
It is important to note that the insolvency process can also have certain consequences, such as the loss of assets or restrictions on creditworthiness. Therefore, it is advisable to seek comprehensive advice beforehand and to understand all aspects of the process.
Alternatively to the insolvency process, there are also other solutions that you can consider, such as debt counseling, installment agreements with creditors, or out-of-court debt settlement. It is important to carefully weigh all options and find the solution that is right for you.
I hope that this information has provided you with some clarity. If you have any further questions or would like detailed advice, I am at your disposal.
Sincerely,
Katja Winterberg
