Voluntary and Involuntary Sequestration, and when is an Insolvency Lawyer Appointed?
With the way interest rates are climbing and the cost of living is rising, it is easy to see how most of South Africa is finding it harder and harder to maintain their debts. Once, financially sound families are largely working to satisfy their credit providers, and in many cases failing. As such many people need to rethink their financial situations. For some this means appointing an insolvency lawyer.
Insolvency lawyers assist in areas of insolvency law, including sequestration. The insolvency lawyer will look at your financial situation and most likely proceed with a restructuring plan. If no reasonable agreement can be negotiated you can lodge an application for voluntary sequestration. You, the debtor, is then relieved from further obligation to pay your creditors, and the creditors’ claims are then brought to a close once they receive their benefit from the insolvent estate, which means the sale of your assets will be distributed to satisfy your creditors. It should be noted that voluntary and forced sequestration is the same thing. The only difference being in who lodges the application for sequestration to the court, either you, the debtor, or the creditor. An insolvency lawyer has an elaborate knowledge of insolvency law and can achieve the best outcome.