Residual debt relief is offered under the Bankruptcy Law when a debtor can no longer repay his liabilities. Often, even the entire sale of the assets would cover only various parts of the debt incurred. Therefore, the function of the debt relief exempts the debtor for a certain time from his debts and give him the chance for a fresh start. Of course, this new beginning is associated with high costs, which the debtor can not pay in this situation. The residual debt exemption, however, comes only under certain conditions to fruition.
In any case, the debtor must provide true and correct information about his entire assets. As long as no information is concealed or the debtor violates the law, the chance of a debt waiver is quite high. So that the debt mountain does not increase further, for example, a loan can be taken despite the absence of residual debt.
Borrowing – A way to finance a fresh start
Of course, the debtor remains in a very difficult financial situation after the discharge of the residual debt. In order for him to help, it is possible to take out a loan to cover the first costs of the new beginning. The loan taken out directly provides financial resources and can be concluded under special conditions so that the liquid burden does not exacerbate the situation even more. Accordingly, a loan is suitable as a financial bridge despite the absence of residual debt. The aim of the entire procedure is that the indebted person can find financial back and settle their debts accordingly from a certain point in time.
Credit despite debt relief
Probably the easiest way to get new funds quickly is to take out a loan from a bank or similar institution. The loan covers all costs incurred during the start-up phase and usually only puts the debtor in more hopeful situations. So that the indebted person receives a loan from a bank, various collateral should be offered. These securities can be generated, for example, by retention of title. Another way to save enormous costs in the construction phase, would be the conclusion of various leases.