By way of debt adjustment, an individual heavily in debt may work to get his or her financial situation on a sound basis.
- A debtor or a guarantor can petition for debt adjustment from the District Court in whose jurisdiction he or she resides.
- The petitioner for debt adjustment should first contact a municipal Money and Debt Advisor.
- The District Court may set a payment schedule for the debtor, laying down how he or she is to service the debts during the following years.
- The duration of the payment schedule is normally five years; during this period the debtor must assign all possible non-essential funds for servicing the debts.
- Once the debtor has serviced the debts to the extent prescribed in the payment schedule, he or she is released from liability regarding the remainder of the debts.
- The payment schedule may be altered upon petition, if the circumstances of the debtor undergo essential changes while the schedule is in effect. If the income of the debtor increases or his or her payment capability is otherwise improved, he or she must increase the amount by which the debts are serviced, as prescribed in the payment schedule.
- If the debtor fails to follow the payment schedule, it may be declared lapsed.
THIS CONTENT IS FOR INFORMATIONAL PURPOSES ONLY. THIS IS IN NO WAY GIVING ANY LEGAL ADVICE OR REPRESENTATION. THE INFORMATION CONTAINED HEREIN WAS COMPILED FROM VARIOUS ARTICLES. FOR ANY LEGAL ADVICE OR REPRESENTATION SEEK YOUR OWN LEGAL COUNSEL.