Consumer bankruptcy



Usually, bankruptcy is associated only with companies. Not all of us are aware that we can also declare bankruptcy ourselves as consumers. Then we talk about the so-called consumer bankruptcy. On what basis is it advertised and who can use it?

In 2016, over 4.5 thousand people announced consumer bankruptcy. Today it is definitely simpler and cheaper than years ago, which means that more and more people are putting waxes for bankruptcy.

First of all, since 2015, debtors do not have to prove that insolvency occurred due to their failure, although, of course, you can not deliberately bring debt and file for bankruptcy. In addition, all kinds of costs have also decreased – currently, the application is only PLN 30. Then, if the debtor is in a bad financial situation, he may also be exempted from the costs of the proceedings. An additional change was the establishment of a repayment plan with the maximum payment time for old debts – 36 months.

Who can benefit from consumer bankruptcy?

This type of procedure is intended for people who, for various reasons, have been “under the wall” and are not able to continue to pay their liabilities. However, as we pointed out earlier, this should not happen as a result of intent or negligence, but as a result of a life situation.

Here too, the interpretations are different. For example, an insufficient prerequisite for consumer bankruptcy is job loss. However, if the loss of work was accompanied by other circumstances, for example, a serious illness, divorce, then these are the appropriate premises for the court to process the application for bankruptcy.

What does consumer bankruptcy involve?

Consumer bankruptcy does not mean that debts are simply canceled. The total remission of liabilities takes place only in a few cases. In order to repay the debt, the debtor’s assets and the repayment of the creditors are being auctioned. Not all of the assets are covered, but only those with an actual market value that are transferable.

This property may be a house, a flat, a plot, a car. In the case of real estate auctions, the debtor will additionally receive from the sale price funds for renting a flat for his family for a period of 24 months.

A repayment plan for consumer bankruptcy 

If the auction does not cover the liabilities, a repayment and debt plan is prepared. This plan is prepared in such a way that the debtor can cope with the repayment of debt, but at the same time, there was no significant deterioration in the quality of his and his family’s life. Currently, this plan may be valid for no more than three years. In special cases, the court may also decide not to prepare a repayment plan.

After conscientious compliance with the repayment plan, liabilities unpaid in the course of the proceedings are discontinued and the debtor is completely indebted. He can, therefore, continue his life with a “clean card”. Therefore, consumer bankruptcy allows the debtor a dignified life, but at the same time also focuses on the maximum satisfaction of the creditors.