Creditors threaten to take your assets. You owe SARS thousands. All accounts are in arrears. Sounds familiar? Are you looking for debt solutions? Read on to discover how voluntary sequestration can help.
WHAT IS VOLUNTARY SEQUESTRATION?
Although not one of the first debt solutions to come to mind, it is one solution that helps you to get rid of all debt. It is a legal process whereby you apply to court to be declared bankrupt. If you qualify, and the court receives no objections, you are sequestrated. The court appoints a curator/trustee who oversees the sale of assets and distribution of the minimum benefits to the creditors.
You receive a new tax number and start fresh – with no creditor harassment. Once you meet the requirements, you can apply for rehabilitation. Once awarded, you are no longer under sequestration and have full financial control over your new estate.
WHY CONSIDER SEQUESTRATION?
If you are looking for a way to pay off all the creditors within a few months, stop garnishee orders against your salary, and start fresh, then this is it. To qualify, you must be insolvent. This means your liabilities must exceed your assets and you must be unable to pay your creditors. Unlike other solutions that entail paying off the amounts owed over years, with voluntary sequestration, you can have all the creditors paid within a few months.
ADVANTAGES INCLUDE:
- Up to 80% of the amounts owed can be written off, as each creditor must receive at minimum 20 cents from each rand owed. If you owe R100 000, then the creditors must receive a minimum of R20 000.
- If, with the proceeds of assets sale, there is a shortfall on the minimum amount, you can pay the shortfall with a lump sum or over 18 to 24 months with interests frozen.
- You are protected against further legal action from the moment the notice of your intention to sequestrate is published and the creditors notified.
- Your pension, personal injury money, tools of trade assets, and the assets of your children are protected.
- The process is discreet, and your employer is not notified.
- You stop all payments to creditors once the notice of your intention to sequestrate is published, giving you a period in which you can save up for a rental deposit or to start over.
- You can sleep better at night, knowing that the creditors cannot take further legal action as all judgments are stayed and interest frozen.
- Creditors cannot call you directly as they have to deal with the insolvency practitioners.
- You start on a clean slate.
If you are looking for easy-out debt solutions, then this is not it, as you will lose assets in the process. But with a new tax number and your SARS tax on the old estate something of the past, you can regain financial composure. Need more information? Visit our FAQ section for answers to your questions.
WRAPPING IT UP – LOOKING FOR LEGAL HELP?
If you are looking for debt solutions that work, consider voluntary sequestration. Complete the online form to determine if you qualify.
Disclaimer: This article is for informational purposes only and does not constitute legal advice. Call on our attorneys for legal advice, rather than relying on the information herein to make any decisions. The information is relevant to the date of publishing.