IVA Glossary
B
Bankruptcy Order
The bankruptcy order is a court judgment which practically will name the individual as being bankrupt. Prior to this judgment, the court will analyze in depth the situation and see if other measures are applicable, such as: dismissal of the bankruptcy petition, suspending the proceedings or redirecting the respective individual towards the solution of an IVA (Individual Voluntary Arrangement). Only after considering these solutions not applicable, will the court issue a bankruptcy order.
After a bankruptcy order is being issued against an individual, or a company, creditors are actually being obliged to stop all collection trials. This means that collection departments must stop calling individuals and asking to recuperate the losses for creditors. Debts are being discharged only after the debtor clears off all their debts. Banking institutions (creditors) can file against a debtor what is known as a "creditor's petition". Bankruptcy should always be the last solution to undertake, because of its serious repercussions it has on one's credit report.
Unmanageable levels of debt can easily pave the way for the release of bankruptcy orders. In order to avoid these, it is important to keep a good management of one's finances, and most importantly keep up with all the required payments towards creditors.
After a bankruptcy order is being issued against an individual, or a company, creditors are actually being obliged to stop all collection trials. This means that collection departments must stop calling individuals and asking to recuperate the losses for creditors. Debts are being discharged only after the debtor clears off all their debts. Banking institutions (creditors) can file against a debtor what is known as a "creditor's petition". Bankruptcy should always be the last solution to undertake, because of its serious repercussions it has on one's credit report.
Unmanageable levels of debt can easily pave the way for the release of bankruptcy orders. In order to avoid these, it is important to keep a good management of one's finances, and most importantly keep up with all the required payments towards creditors.
