In South Africa, the Insolvency Act offers an individual who cannot repay their debts owed to creditors, a fresh start. If you're struggling with insurmountable personal debts, you may want to consider going insolvent as a viable option to a debt-free future and the quickest way to rebuild your financial life.
How does it work?
Filing for Insolvency involves a High Court application during which a person surrenders their estate to the Master of the High Court. This court-based procedure is both costly and subject to various terms and conditions, which the public is not always made aware of. However, if done correctly and provided you qualify, this becomes the most viable option for getting rid of debt.
At Grobler Malope Incorporated we offer any potential client an initial free Debt Analysis to:
- Ensure you qualify for this option;
- Explore any other viable options;
- Provide you with a strategy going forward;
- Make you aware of the pros and cons involved;
- Ensure you know exactly what to expect; and
- Provide you with a timetable, should you choose to proceed.
You will be under no obligation to make use of our further services.
The Process
Should you choose to instruct us, the process will proceed as follows:
- We will consult with you, either by telephone, virtually, or at our office to obtain the required information;
- A draft Statement of Affairs will be prepared, which is basically a complex list of your assets, their estimated value, your creditors and liabilities;
- Any assets you own will then need to be evaluated by a sworn appraiser or professional valuator, who will be acceptable to the court. This is done to provide evidence of the asset's anticipated forced sale value. It will also represent the value for which you may repurchase the assets from your trustee;
- We will proceed to secure a court date at the relevant High Court;
- Once the Statement of Affairs has been finalized, it will lay open for inspection at the Master's Office and local Magistrate's Court for 14 days, ending 2 weeks before the court date;
- We will then proceed to draft the required affidavits, along with any supporting documentation and once all the affidavit have been signed, the application will be finalized for service on the Master of the High Court before being lodged at the Registrar of the High Court;
- The case will then be enrolled and we will proceed to brief the relevant advocate on the matter;
- On the court date, our advocate will proceed to argue your case - you need not attend the court proceedings;
- Once granted, we will inform your creditors and await the appointment of your trustee.
Requirements
The courts will only approve this process if they determine that:
- Your estate is truly insolvent (total debt exceed the combined value of your assets); and
- Your estate, if sequestrated, will be of sufficient value to defray all the administration and legal costs involved in the process; and
- That the sequestration will ultimately be in the best interest of the creditors involved. In practice, this means that the court must be convinced that creditors will eventually receive a minimum dividend of 20c per Rand owed.
If any of one of the three aforementioned requirements are not met, it will not be granted and is doomed to fail. Should your assets be of inadequate value, your friends and family may contribute or donate assets of cash to your estate, to ensure the success of the application.
How to proceed
All you need to do is to phone us or email us your contact details. We will gladly answer your questions on the way forward and you will be under no obligation to make use of our further services.
Phone us now on 087 057 1790 or 014 592 9259 for a free, no-obligation chat.
Copyright © 2023 Rohan Lamprecht. Disclaimer: The information in this article is of a general nature for educational purposes only, relevant to the publishing date. Any opinions expressed are solely those of the author and do not necessarily reflect the views or opinions of Grobler Malopi Inc. The content is not intended to constitute professional or legal advice, and you are encouraged to call and consult with our attorneys to discuss your specific situation before making any decisions. Grobler Malope Inc - 087 057 1790 - info@gmilaw.co.za