 Insolvency is otherwise known as bankruptcy; liquidation; sequestration; voluntary surrender, but all fall under the umbrella of Insolvency
Insolvency means you use your assets to get rid of creditors
FAMOUS PEOPLE WHO WERE SEQUESTRATED:
Donald Trump (twice); Walt Disney (before he started Disney Pictures); Abraham Lincoln (16th American President); Milton Hershey (was sequestrated 4 times – on the fifth go he started Hershey’s chocolates – today a huge international company); Meat Loaf; William C. Durant founded General Motors and Chevrolet. General Motors is the biggest car manufacturer in the world today; Thomas Jefferson(American president); Kim Bassenger (actress); Heidi Fleiss(the famous “madam”); Ulysess S Grant (18thAmerican President) ; La Toya Jackson (Michael Jackson’s sister – singer and actress); Larry King (famous talk-show host) ; William McKinley (25th President of the USA)
“Insolvency is for people with too much debt or where the bank has repossessed the property."
WHAT IS INSOLVENCY?
INSOLVENCY is the only legal mechanism to completely get rid of creditors.
Insolvency is the umbrella term for liquidation and sequestration.
INDIVIDUALS SEQUESTRATE:
Individuals sequestrate. An individual can voluntarily surrender his/her estate or a creditor can apply for sequestration. Voluntarily surrender is when one applies to Court oneself to declare oneself insolvent. (It is also sequestration/bankruptcy). A person is sequestrated when a creditor brings an application to declare a debtor insolvent. You are insolvent when your liabilities exceed your assets. Ideally you should own property when you sequestrate, because if you don't own property, you must be able to pay your creditors 20c in the Rand in cash. Insolvency (bankruptcy) is therefore ideally mainly for the person who owns a property or other unecumbered assets of value.
When you own property and the bank has repossessed the property or when you simply have too much debt that you cannot pay and you cannot handle the money worries any longer, that is the time to sequestrate. If you don't and Judgment is taken against you by a creditor, the Judgment stands for THIRTY years AND you still have to pay the debt. If you sequestrate, the debt gets WRITTEN OFF; the sequestration stands for only FOUR years, after which you rehabilitate and get back to normal.
BUSINESSES LIQUIDATE:
In terms of the Close Corporation Act, the Trust Act and the Companies Act a business must liquidate when its liabilities exceeds its assets. It is not necessary for a business to own assets. If a business experience debt problems, liquidation is an excellent option to get rid of creditors.
A business brings a liquidation application and the process is similar to that of sequestration by individuals, except that assets are not a requirement as with a sequestration application of an individual.
It is illegal for a business to trade when its liabilities exceed its assets, therefore a business must liquidate when it has reached this situation.
INSOLVENCY ACT:
The Insolvency Act is available to any South African citizen. It is everyone's avenue to legally have debt written off, get the help each person deserves and become debt free. It is the best debt advice I can give anybody. If you do not qualify for debt counselling, or if the repayment period under debt counselling will take too long, or if your creditors are becoming too much with their debt collection procedures, the Insolvency Act is to your availability to use to become free of debt.
ELIMINATE DEBT AND STAY ON YOUR FEET:
The paradox of insolvency is that it is a mechanism to use to stay on your feet. If you can have your income all to yourself instead of having to pay it to creditors, you will recover sooner. Insolvency grants you this opportunity.
REPOSSESSION OF PROPERTY:
If the bank has attached your property to sell in execution, or if the bank forecloses on the bond, or if the bank threatens to reposess the property, it is a good time to consider sequestration. If the bank repossesses the house and sells it on an execution sale it takes judgment against you. The property is sold most of the time at any price and you remain liable for the shortfall FOR THE NEXT THIRTY YEARS. Remember, in this scenario the bank only pays the bank, and your other creditors remain due. You are unlikely to recover from this situation. NOW is a good time to sequestrate.
With sequestration, the property is sold on an insolvency auction at a better price, the proceeds are distributed amongst creditors and any creditor that does not get paid, must write the debt off. Any shortfalls are written off completely and you do not have to pay it.
DEBT SOLUTIONS:
Insolvency is the best solution to debt problems. The solution is to eliminate debt and to free yourself from your creditors and money problems.
INSOLVENCY ATTORNEY:
I keep my focus on Insolvency in my practise, as I do not see another way to successfully assist people who experience financial problems to get them free from creditors and keep them on their feet. When you make use of my services, you can rest assured that I will not only ensure that you are fully au fait with the process of sequestration/liquidation, but I also educate you in your rights so that you can be empowered to make better decisions in the future and protect yourself. That is why my website address is empowerlaw: I want you to be empowered during and after the process of sequestration/liquidation, so that you can create wealth in the future and take part in the economy, instead of living in fear and worry and not being able to have a healthy financial life.
GET RID OF CREDITORS:
With insolvency one uses one's property as leverage to get rid of ALL creditors. Some people think that you loose everything and are down and out facing money problems for the rest of your life if you sequestrate. This is not true. In fact, it is exactly the opposite. Sequestration allows you to carry on with your business and your life, free from creditors. Sequestration stands for four years PLUS you don't have to pay any of the debt. After four years you rehabilitate, your records are cleared and you are back to normal.
Insolvency is the leverage that you use to get out of a situation that would otherwise make it impossible for you to become debt free.
VOLUNTARY SURRENDER:
When you approach the Court yourself, it is called voluntary surrender. There are also sequestration applications, where a creditor of yours bring an application to Court to have you sequestrated. The processes differ a little bit, but the end result is the same.
FREE CONSULTATION WITH US:
During your free consultation (whether by phone, email or in person), we will tell you everything we know so that you can make an informed decision. If you decide not to go ahead, that is fine, but at least you can then make a better decision than you would have if you did not have the knowledge. We gladly pay forward our knowledge.
ASSISTANCE FOR PEOPLE IN BAD DEBT:
Our aim is to assist you through a difficult period, so that you are not only able to carry on with your life with the least inconvenience, but I also look at your future and will give you the best advice to leave you protected during your new life and in the future. I want you to be successful without the burden of debt. The majority of my practise is aimed at people with too much debt, so I understand the psychological effect of debt. The fear, the worry, the feeling of failure, the shame, the guilt. These emotions are universal when it comes to not being able to pay one's debt. If you read on, you will understand the sequestration and liquidation processes better and hopefully it will open a door for you which you were not aware of.
INSOLVENCY - HOW DOES IT WORK?
SEQUESTRATION/VOLUNTARY SURRENDER:
Individuals sequestrate. There are three types of sequestration: agressive or friendly sequestration, or voluntary surrender. In the case of agressive sequestration, a creditor brings an application for sequestration against you, for example the bank (an agressive creditor). In the case of friendly sequestration, a creditor whom you are on a friendly basis with brings the application and with voluntary surrender, you approach the court yourself.
LIQUIDATION:
If your business is failing or if you do not turn over enough money any longer to sustain the business, it is good time to liquidate the business. It is no use trying to revive a corpse and the sooner one is able to make a clinical instead of an emotional decision, the sooner one can recover.
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THE PROCESS OF SEQUESTRATION:
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A PROVISIONAL APPLICATION – a provisional order is granted
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B The matter is postponed for one month (return date) to allow creditors to oppose the application
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C On the return date, the Provisional Order is made final, the person is now sequestrated
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D Trustee/Curator appointed by the Master of the Supreme Court (The Curator is tasked with selling the assets, paying the creditors and reporting to the Master
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E Creditors paid. Balances not recovered WRITTEN OFF.
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F NO MORE DEBT TO PAY
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SEQUESTRATION ADVANTAGES:
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R As soon as the provisional order is granted, all legal
actions and collections are suspended,bringing great
relief from phone calls and letters;
R The moment a person decides to sequestrate, she/he
stops paying all debt. to pay any further debt at this
stage would be throwing good money after
bad (immediately cash flow improves);
R As soon as the final order is granted a person is
sequestrated and is free from debt;
R A person can rehabilitate after four years and life
then gets back to normal, debt free.
R This enables him/her to start a new life to get back
on his/her feet without the burden of having to pay
off debt;
R You can stay in the property until the property is
sold, anything from 4 – 6 months without paying any
debt;
R The person can make an offer to the curator to
purchase back his/her furniture (if it is fully paid)
and arrange to pay it off;
R As long as you control your assets, you can use
it to your benefit to get rid of ALL creditors.
R If you loose control to a creditor, the creditor sells
the assets to ITS OWN benefit only and all other debt
remain due. Sequestration avoids this problem.
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TWhere persons are married in community of property, one application is brought
TWhere persons are married out of community of property, and both persons are applying for sequestration, it would be two separate applications. However, we shall give a separate quote for instances such as these.
COSTS:
We will give you cost quote during our consultation or when you email us.
WE WORK NATIONALLY:
LIQUIDATION
(Close Corporation, Trust, Company Act(entity))
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A No assets are required for an entity to liquidate,
because:
B The Close Corporation Act, The Trust Act and the
Companies Act determine that an entity is not allowed to
trade if its liabilities exceeds its assets
C Therefore it is easy to liquidate an entity, there are less
formalities than for sequestration
D If a person has signed surety for the entity, he/she will
have to liquidate and sequestrate, as he/she would also
be personally liable for the debt of the entity under the
suretyships. (We don't always liquidate - we need
to discuss this with you first)
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WE WORK NATIONALLY.
You will find after a consultation with us that you feel empowered to make wise decisions, to negotiate better and to loose the fear and worry. Debt is nothing to be ashamed about. The New Credit Act, the recession and various other external matters have caused a financial slow-down for the South African economy. Do not take it personally. Rather admire yourself that you had the courage to take the risk, then empower yourself with the necessary knowledge so that you can put yourself in a better position and do better business in the future. We gladly assist you.
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