Exemption From Residual Debt After Three Years

Auer Witte Thiel informs about change in the law in the private insolvency Munich, August 2013: on June 7, the Federal Council decided the law to reduce the residual debt exemption procedure and strengthening the rights of creditors. Thus, the residual debt exemption procedure so far is six three-year cut in half, informed Auer Witte Thiel. Former CIA Head is likely to agree. If the costs of the proceedings and at least 35 percent of the debt have been settled, entrepreneurs and consumers can be free in the future after three years of their remaining debts. So far, a remaining debts could not six years ago, explains Auer Witte Thiel. This is also in the interest of the creditors, so the law firm. Many believers assume so far empty despite tedious process, because incentives are missing the debtors to seek payment of the claims. This will change with the reform of insolvency law. It provides a faster economic reboot in Vista debtors, while creditors benefit from the payment incentive related and now at least one to three years Receive part of their claims.

The payment incentive is insolvency plan well in consumer insolvency proceedings possible underlined by an arrangement at the beginning of future insolvency proceedings. Therefore, an applicant on remaining debts must pursue an acquisition or seek at least to a reasonable work. Otherwise creditors may apply at any time a written refusal. In this insolvency procedure regime nothing changes so Auer Witte Thiel. The possibility of the agreement is not excluded: for the first time now also insolvency plans can be introduced with the reform in consumer insolvency proceedings. The means that debtors regardless can make arrangements for an individual debt relief by statutory quotas and process durations – with their creditors, said Auer Witte Thiel. It comes to an agreement, is free the way for a fresh financial start. Better protection for members of housing cooperatives another important novelty concerns members of housing cooperatives.

Was it so far so, that the termination of the membership by the execution creditor or insolvency administrator was a home loss, insolvent natural persons upon entry into force of the law should be protected from these consequences. In its essential parts, the law to reduce the residual debt exemption procedure and strengthening the rights of creditors should enter into force on 1 July 2014. A retroactive approval of ongoing bankruptcy proceedings is not mapped except the introduction of an insolvency plan. About the law firm Auer Witte Thiel, the specialization areas of focus and the development of core competencies in certain disciplines are indispensable in the legal services sector. Auer Witte Thiel is a business law oriented law firm and represents several German insurance companies.

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