Everyone can become bankrupt

Everyone can become bankrupt

October 1, 2015, Maxim Blanc

From the "Daily Journal",

In Russia, from October 1, the law on bankruptcy of individuals entered into force. Now everyone who took more than half a million rubles in the bank and was not able to serve this debt can go to court with a claim for recognition of himself bankrupt. The borrower may also initiate bankruptcy proceedings in relation to the debtor if the delay on the loan exceeds 90 days.

The first law is the second largest retail bank VTB-24 to “test” the first law. On the eve of the entry into force of the law, the bank representative said that already in October 10-20 claims would be filed on the declaration of bankrupt by the debtors of a credit institution in order to see the extent to which the judicial system is ready to “digest” the new law. If ready, then 143 thousand borrowers theoretically fall under the law only in VTB-24. The estimates of the total number of potential bankruptes in the country differ by an order of magnitude - from half a million to 5 million people, of which only in Moscow and the Moscow region - 4 million.

The bankruptcy procedure itself is a very unpleasant event. If the court satisfies a citizen’s claim for declaring him bankrupt, a person loses the right to manage his own property, which is being arrested. The property is sold by the appointed bankruptcy trustee, who transfers the proceeds to creditors. Only the only housing, as well as housing, where minor children, food, food in the amount of the subsistence level, personal belongings (clothes, shoes, etc.), prizes, winnings, memorable and honorary signs, state awards, state awards are regulated on a permanent basis.

In addition, the norm will be added to the law on the procedure for leaving the Russian Federation that the right of a citizen recognized as bankrupt, to leave the country, may be limited before the court made a decision on the completion of or termination of bankruptcy proceedings.

Only after all the subject confiscation is sold, the citizen recognized as bankrupt is no longer considered the debtor and gets rid of all previous debt obligations. And this is the main relief for citizens carried away by loans, since now the court is also arresting and sells the property of malicious defectors, but the rest of the debt that could not be repaid by the sale of property continues to “hang” over the borrower.

Attempts to get loans, rewrite property to relatives and declare themselves bankrupt by the courts will be suppressed. The plaintiff must attach lists of his creditors, an inventory of his property, a certificate of accounts, deposits, income and taxes paid for three years, as well as information about real estate transactions for the same period. Nevertheless, there is no doubt that there will be a lot of people who want to use the money of banks without risk of losing the only housing, and this is the main danger, which is laid down in the law on the bankruptcy of individuals.

But even if this is not the case, if the filing of claims for recognition of itself bankrupt will take a massive nature, this will seriously hit the Russian banking system, since banks will be forced to finally write off the outstanding debt of bankruptes. To date, according to the statistics of the Central Bank, almost 40 million Russians should be banks, that is, more than half of the economically active population. The total amount of citizens' debt exceeds 10 trillion rubles. At the same time, 5 million Russians do not pay in their loans worth 1.3 trillion.