Can an unemployed person apply for insolvent and bankrupt
3 months ago
I was working until last year. Due to a severe health issue, I cannot join any job. I have taken loans of around 13+ lakhs and 1.3 credit cards. I have not paid EMI for the last 1 year. I get constantly threatened by agents who trouble my friends and siblings for recovery. The doctor suggested I should take a rest, or else I would spoil my health again. I have no means to pay EMI and have no property, so can I apply for insolvency/Bankruptcy to avoid this harassment? After a year or 2 can I join a co-operate job and restart my career again? Does this insolvency certificate affect my future job, or can't I join any company?
If No then chow can i apply and how many days procedure is it?
A.Dear Client,
If you are facing financial distress and are unable to repay your loans due to health issues, you may consider filing for insolvency under the Insolvency and Bankruptcy Code (IBC) in India. The process involves declaring yourself bankrupt and seeking resolution for your financial obligations through the National Company Law Tribunal (NCLT). Filing for insolvency can provide relief from creditor harassment and give you an opportunity for a fresh start.
Once you obtain an insolvency certificate, it may affect your credit score and financial history. However, it doesn't necessarily restrict you from joining a corporate job in the future. Employers generally focus on your skills, experience, and qualifications rather than your past financial difficulties.
To initiate the insolvency process, you should consult with a qualified insolvency professional or approach the Debt Recovery Tribunal (DRT) if your liabilities are within the applicable limits. The procedure involves various stages, including the admission of your application by the NCLT, appointment of an insolvency professional, and formulation of a resolution plan.
It's important to note that the insolvency process may take some time, and the impact on your credit history will remain for a certain period. Additionally, individual cases may vary, and seeking advice from a legal professional or a financial counselor can provide tailored guidance based on your specific circumstances.
Thankyou
If you are facing financial distress and are unable to repay your loans due to health issues, you may consider filing for insolvency under the Insolvency and Bankruptcy Code (IBC) in India. The process involves declaring yourself bankrupt and seeking resolution for your financial obligations through the National Company Law Tribunal (NCLT). Filing for insolvency can provide relief from creditor harassment and give you an opportunity for a fresh start.
Once you obtain an insolvency certificate, it may affect your credit score and financial history. However, it doesn't necessarily restrict you from joining a corporate job in the future. Employers generally focus on your skills, experience, and qualifications rather than your past financial difficulties.
To initiate the insolvency process, you should consult with a qualified insolvency professional or approach the Debt Recovery Tribunal (DRT) if your liabilities are within the applicable limits. The procedure involves various stages, including the admission of your application by the NCLT, appointment of an insolvency professional, and formulation of a resolution plan.
It's important to note that the insolvency process may take some time, and the impact on your credit history will remain for a certain period. Additionally, individual cases may vary, and seeking advice from a legal professional or a financial counselor can provide tailored guidance based on your specific circumstances.
Thankyou
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A.Dear client,
In the prevailing situation, you may file for bankruptcy. Under the Provincial Insolvency Act, 1920 (which is now repealed as IBC Code 2016), you can file for bankruptcy if you are unable to repay a debt greater than ₹500. After analyzing whether the conditions for filing of bankruptcy have been met, the court may accept or reject the application. But, as stated having no asset with you, your insolvency petition may be rejected by the Court. Alternatively, you can try to negotiate a debt settlement on your own if your pocket permits to repay the entire outstanding at a time for a one-time settlement of dues, but sometimes it's typically done through third parties like debt relief companies, which you may hire to negotiate the settlement matter with the lender on your behalf. With this method, you will make payments to the debt settlement company rather than your creditors/lenders, along with any fees. Debt settlement is an agreement between a lender and a borrower in which the borrower repays a portion of a loan balance and the lender forgives the remainder. You may consider starting the negotiation by offering to pay 25% or 30% of your outstanding balance in return for forgiveness on the rest. But, it may be noted that while there are legitimate debt relief/settlement companies, there are also many scam operations. So, if you're considering one, the Consumer Financial Protection Bureau(CFPB) suggests for contacting your state attorney general's office and local consumer protection agency to ask if they have any consumer complaints on file about that company. Some states require that debt settlement companies be licensed, which may provide some added protection. Although a debt settlement can offload some of your financial crisis, there are also a few potential risks and downsides to consider. First, a debt settlement will affect your credit score. That will make it more difficult for you to get credit or good interest rates in the future. Another potential drawback is that when you settle debt, you could face tax consequences. Finally, when you settle a debt with a credit card company, your account is closed once the settlement is complete. So you could potentially have no credit facility to use a credit card further owing to your poor credit score. Further, a quick counselling session with a certified credit counsellor can help you to discover your options and choose the right path forward to settle the debts/loan with the Bank.
In the prevailing situation, you may file for bankruptcy. Under the Provincial Insolvency Act, 1920 (which is now repealed as IBC Code 2016), you can file for bankruptcy if you are unable to repay a debt greater than ₹500. After analyzing whether the conditions for filing of bankruptcy have been met, the court may accept or reject the application. But, as stated having no asset with you, your insolvency petition may be rejected by the Court. Alternatively, you can try to negotiate a debt settlement on your own if your pocket permits to repay the entire outstanding at a time for a one-time settlement of dues, but sometimes it's typically done through third parties like debt relief companies, which you may hire to negotiate the settlement matter with the lender on your behalf. With this method, you will make payments to the debt settlement company rather than your creditors/lenders, along with any fees. Debt settlement is an agreement between a lender and a borrower in which the borrower repays a portion of a loan balance and the lender forgives the remainder. You may consider starting the negotiation by offering to pay 25% or 30% of your outstanding balance in return for forgiveness on the rest. But, it may be noted that while there are legitimate debt relief/settlement companies, there are also many scam operations. So, if you're considering one, the Consumer Financial Protection Bureau(CFPB) suggests for contacting your state attorney general's office and local consumer protection agency to ask if they have any consumer complaints on file about that company. Some states require that debt settlement companies be licensed, which may provide some added protection. Although a debt settlement can offload some of your financial crisis, there are also a few potential risks and downsides to consider. First, a debt settlement will affect your credit score. That will make it more difficult for you to get credit or good interest rates in the future. Another potential drawback is that when you settle debt, you could face tax consequences. Finally, when you settle a debt with a credit card company, your account is closed once the settlement is complete. So you could potentially have no credit facility to use a credit card further owing to your poor credit score. Further, a quick counselling session with a certified credit counsellor can help you to discover your options and choose the right path forward to settle the debts/loan with the Bank.
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