Debt Rehabilitation Help to End Sequestration in South Africa

 If you have been sequestrated, you will know that, while under sequestration, you cannot be a director of a company, cannot apply for a liquor license, must disclose your sequestration status, and get permission from the curator or trustee before you enter into a credit agreement. In effect, your financial affairs in the surrendered estate are managed by the trustee. Being insolvent implies that you are not capable of paying debt.

One option is to wait out the 10-year period of sequestration. After ten years, you will be automatically rehabilitated. However, this is a long time, and the idea of sequestration is to get rid of debt and to start afresh. Staying sequestrated for the entire 10-year period means not being able to get a home loan or holding some specific job positions. If you do not want to wait out the 10-year period, it is time to get debt rehabilitation help. You will need the assistance of insolvency attorneys, since you must bring an application for rehabilitation to the High Court of South Africa. You do not have to appear in court in person. It is a written application, which is submitted to court by our attorneys on your behalf as part of our service to provide debt rehabilitation help.

When do you qualify for debt rehabilitation help?

 The good news is that you can approach the trustee of the insolvent estate at any time with a proposal to pay 50 cents in the rand to the creditors. This includes all the creditors. You must provide security for your intention to pay the creditors. Once the Master of the High Court approves the proposal and issues a certificate that reflects the security, you can, with our debt rehabilitation help, apply to have the sequestration ended. You will also need to prove that you can pay the administrative costs of the sequestration.

You can also apply for rehabilitation after a period of four years has lapsed since the date of sequestration and the first liquidation account has been confirmed. To this effect, you will appreciate our debt rehabilitation help in this process. We will draft the affidavit and the notice of your intention to apply for rehabilitation, which will be published in the Government Gazette. We will also send a notification to the Master of the High Court and apply for permission for application to rehabilitate from the estate trustee. You will need to prove that you are financially capable to handle your own financial affairs and thus able to provide for yourself.

If you have been convicted of a criminal offense related to your insolvent estate, you will have to wait five years after the criminal judgment date before you can apply for financial rehabilitation. However, we will still be able provide you with the appropriate debt rehabilitation help in this instance. In the instance where you have been sequestrated before, you need to wait for a period of four years after sequestration and three years after the first liquidation account has been confirmed before you can apply for rehabilitation. Should you wish to apply for early debt rehabilitation, you will appreciate our professional help, since you must be able to prove that the rehabilitation will be in the best interest and to the benefit of South Africa. Where the sale of assets during the sequestration process has delivered sufficient funds to pay the creditors in full, you can apply for rehabilitation immediately.

What will rehabilitation mean?

 The status of “sequestrated” will be removed from your credit records. It will be replaced with the status of “rehabilitated”. The latter status will remain on your credit record for a period of five years, after which it will be removed without the need to apply for its removal. You will no longer require the permission of the trustee to enter into credit agreements, will not have to disclose your status as sequestrated, and will regain full control over your financial estate. All debt in the estate will be written off and the sequestration will officially end.

With our debt rehabilitation help, you can become financially rehabilitated sooner than the 10-year period and probably even sooner than you realised. We recommend speaking to our insolvency attorneys about your options, the costs involved, and the procedures to follow.

Disclaimer: Information is relevant to the date of publishing and is not intended as any form of legal advice. Please call on our attorneys for legal guidance rather than relying on the information herein to make decisions – November 2017.