If you can no longer pay off your debts, you can go bankrupt. Bankruptcy means that almost all your belongings will be seized and that these will be sold at a bankruptcy auction by the bankruptcy trustee.
When do you go bankrupt?
A bankruptcy is pronounced if you can no longer pay your debts. In the event that two or more of your creditors apply to the court for your bankruptcy, there is a very high chance that you will be declared bankrupt. Bankruptcy is not fun and it is, therefore, advisable to always keep track of whether you will be able to repay a particular loan, and certainly if you have a negative BKR, be cautious about closing a new loan.
You can try to apply for debt restructuring if you can no longer pay your debts. This is a scheme that can make sure that you get back on top and that you are not declared bankrupt. You will be assigned an administrator who will help you to get rid of your debts. The debt restructuring usually takes 3 years.
Both individuals and companies can go bankrupt. If you go bankrupt personally, this means that your assets will be sold to meet the claims of the creditors. Even if you have a one-man company or a RIVI, you will go bankrupt and the creditors will tell their money on your personal belongings.
You can also go bankrupt in the business sector, but a distinction is made here between personal liability or not. At a RIVI or a sole proprietorship, you will be personally liable for the debts. This is not the case with a BV or NV, although you can still be held liable if you as a director if you have poorly managed.
Debts do not disappear after bankruptcy
After the bankruptcy, your debts will not disappear. Creditors will still be able to knock you back to get their loan repaid. You may be able to conclude an amicable agreement with your creditors to get rid of your debts.
Borrow money despite bankruptcy
Can you borrow money despite bankruptcy? Although it is very unwise to conclude new debts after a bankruptcy, especially since there are still debts, there are opportunities that you might still be able to get through a loan. However, this is highly recommended! You can usually close mini-credits, or close a loan by giving something in collateral to a pawnshop.
Please note that (in the case of a pawnshop) high-interest rates are calculated and there is a chance that you will no longer get what you give in collateral if you cannot pay off the loan. A mini loan for small loans wisely, all you gotta pay quickly the loan. However, there is usually no BKR check in both mingling and a pawnshop.