Many people have problems in work and personal life due to executions. They are a big complication when people are trying to return to a “normal“ life. The amendment to the Bankruptcy and Restructuring Act, which regulates the debt relief of private persons, will help people to get out of their diffucult life situation.
One of the most common reasons for declaring personal bankruptcy is falling into a spiral of debts from which you can´t get out. After the legislative amendment of Act no. 7/2005 on bankruptcy and the restructuring from March 1, 2017, personal bankruptcy has become much more accessible option for the general public.
Restart for people
Personal bankruptcy refers to a regulated and controlled process during which every private person may be relieved of debts. It is possible even without owning any property or having income. If the debtor owns any estate or personal assets he has to be aware of monetization of these assets. Monetization of assets is subsequently used for payment of debts.There are conditions and rules that private persons need to follow during this process of debt relief.
„ If we make bankruptcy available to people, they will no longer face so many executions. The option to get rid of debts by bankruptcy will be possible with te fact that creditor will be paid from sold assets. At the same, the debtor will be protected from the loss of housing. Another option is payment calendar“.
Former Minister of Justice, Lucia Žitňanská
Pay attention to the conditions.
Right to ask for debt relief by personal bankruptcy will be possible for private person only if there is execution or similar procedure in force against this person. The debtor will be considered as insolvent person if : is unable to pay at least one obligation 180 days past due. Then he is obliged to return this advance to the Legal Aid Centre in monthly payments within 3 years. Debtor must have also his Centre of main interests in the Slovak Republic that must be demonstrated by relevant evidence,. That means that he must be resident of Slovakia, have family, assets, social and economic relations in this country.
„The debtor will receive more protection and executor will be more responsible for the execution process. At the same time we are taking execution agenda from courts which will contribute to a better approach to justice . By making changes in bankruptcy law we make a more accessible this option of debt relief to those who, for their own fault or for other reasons, have fallen into life full of debts and they can´t get out of it themselves. The state will help the poor with debt relief costs. We are also increasing protection of debtors against total loss of their housing. „
Former Minister of Justice, Lucia Žitňanská
The main goal of personal bankruptcy is to get rid of debts.According to the proposal, debtor will be able to get rid of his debts by bankruptcy. He will hand over the assets for monetization and then the court should decide about bankruptcy within 15 days. That day the debtor is released from his debts and there won´t be any execute enforcement proceedings going on against his person. Receivables become irrecoverable and new ones cannot begin. The debtor may begin to live normal life again.He will be able to open bank account and work without fear of any deductions at work.
