Most people worry about how to recover from bankruptcy in Singapore. Fortunately, it is possible if you’re cautious with your transactions. Learn more.
Many Singaporeans view bankruptcy as the end of all their finances. However, though they are right that it means hitting rock bottom, bankruptcy also means starting again from scratch.
Bankruptcy is not the end of everything. It is a legal status that a debtor can apply for, or creditors can file an application to make a debtor bankrupt. A debtor can be bankrupt if the person can’t repay the debt amounting to more than $15,000. The High Court will then decide if the application should be granted. Should the bankruptcy status has been finalized, the High Court will appoint an Official Assignee or trustee.
The trustee has a couple of responsibilities for both the debtor and the creditors. First, the trustee will determine the Target Contribution the debtor has to pay to be discharged. Also, they identify the amount of the Target Contribution based on the debtor’s salary. Plus, they include the amount of money needed for the primary needs of his family and for him to go to work every day. The contribution will only be sufficed if the debtor can pay the Target Contribution in full within 52 months, 72 months for repeat bankruptcy.
The trustee doesn’t only handle the debtor’s assets and how they will distribute them to the creditors. But, they also investigate the debtor’s debts, affairs, and conduct.
Since January 2016, a total of 1,827 individuals have had bankruptcy applications. As we cringe for them, let’s have an idea of how they live their lives now. Like other people around the world, Singaporeans will try to avoid bankruptcy, yet if worse comes to worst, how can you recover from bankruptcy in Singapore?
Your estate or assets will be seized by the High Court and managed by the trustee. Bankrupt has to file the ‘Statement of Affairs’ within 21 days after the Bankruptcy Order has been filed. All information must be truthful and must include both the assets and liabilities.
Fortunately, they will not take everything away from bankruptcy. So you can keep the HBD flat (unless it has been refinanced), necessities for your family to survive, your tools related to your trade as you still have to work, and assets you have been holding for someone.
Bankruptcy does not mean your employer will dismiss you, though those who have work-related to finances can get fired. You have to work regularly to pay off your monthly contributions to pay off your debt. Your creditors can’t get all your salary, as you still need to survive. Since you have very little money, you need to explain to your trustee should you have been found out to have any luxury expenditures.
If you go bankrupt, you can’t keep it a secret. Everyone will be informed, including your employer and the rest of the public. It can create a severe dent in your career. Also, it is why bankrupts can’t get into a higher position in the company.
Should there be a pressing need to fly abroad, you must ask for your trustee’s approval. Your chance to go to another country will most likely depend if you can pay your monthly contributions diligently.
Your credit rating will suffer from the financial blow. Banks will not give you any loans. It is the reason you have to rebuild your credit score.
The faster you can reach your target contribution, the soonest you recover from bankruptcy in Singapore for first-timers. However, your bankruptcy will stay in your public records for another five years after your discharge.
Since you are bankrupt, your legal actions must all go through your trustee. However, it does not include legal actions about damages for personal injuries or matrimonial proceedings.
You can use this opportunity to build your credit score slowly. For example, you can get small personal loans and repay them. It may take years, but you can get back on track again after five years of having your bankruptcy lifted.
You cannot act as a manager or director of a company unless you have the permission of your trustee. You will have a fine if you violate the restrictions.
An evaluation will occur based on what can be left in your possession and which ones will be owned by the creditors. Therefore, it is essential to be honest since they will most likely find the truth anyway. Thus, save yourself from more trouble.
The earlier you settle your Target Contribution, the faster you can be discharged from bankruptcy. In as short as 3 to 5 years, they will lift the bankruptcy provided that you have diligently paid for 52 months and no creditor objected. However, you can still be discharged after seven years despite failing to repay your contributions.
The downside is your record of bankruptcy will be permanent. It will be harder to get a car loan, a mortgage, or even a personal loan from banks and most financial institutions. Also, this will be a permanent hindrance when looking for a job. Finally, it will be catastrophic if your career is in finance.
Know how you spend your money. While the trustee is already evaluating your finances, you should also do the same for yourself.
No matter how small the cash is, it is still handy to have a monthly budget to keep track of your limited finances.
You can avoid being in more debt and rebuild your credit score by paying the bills on time.
Rebuild your credit score by getting small loans and paying them.
There will be a lot of lenders who will try to take advantage of your cash needs. However, choose the best and most trusted money lender in Singapore as your financial partner. It will be better to stay with one lender rather than get loans from multiple financial institutions. Money lenders with loyal clients sometimes give discounts or omit the documentation fees.
If you need the best personal loan in Singapore from a reputable money lender, you can start by dropping by Cash Mart. It is because cash Mart not only focuses on creating various flexible loans products but also values a lasting relationship with its clients.