Bankruptcy proceedings can be used by companies or individuals who cannot handle payments to creditors on their own. To implement this process, you need to apply to the bank. Often during the implementation of this procedure, debt reorganization or restructuring occurs, which leads to the fact that the company or citizen is not recognized as insolvent, therefore, loans are easily repaid further. But usually you have to resort to bankruptcy proceedings, which consists in the sale of property belonging to the debtor. The correct procedure for the sale of bankrupt property consists of several stages. The appointed manager is involved in this process. After the sale of the property, the debt is paid off at the expense of the proceeds.
Bankruptcy concept
The procedure assumes that the person or company is declared insolvent. Based on such a decision, existing debts to various creditors are repaid. For this, the cash available to the debtor or money in the accounts is used. If necessary, bankruptcy proceedings are held involving the sale of property of a citizen or enterprise.
Bankruptcy procedure involves the implementation of several stages:
- a petition is filed with the court with a request to declare the debtor bankrupt, and the plaintiff may be state bodies, the direct non-payer or creditors;
- all signs of insolvency are identified;
- an opportunity is offered to carry out restructuring, for which lenders increase the terms of lending, reducing the loan burden from the borrower;
- if the terms of the contracts are violated by the debtor, the bankruptcy process continues, for which purpose the sale of bankruptcy property of individuals or firms is applied;
- often lenders prefer to make a settlement agreement with debtors.
If bankruptcy proceedings are carried out, then a manager is appointed by the court, who deals with all issues related to this process. The procedure for the sale of property of bankrupts and debtors must be strictly observed, since the legality of recognizing citizens and companies insolvent depends on this.
Use of electronic debt
Since 2010, the procedure for the sale of bankrupt property involves the use of electronic platforms for these purposes. The procedure is implemented by the appointed financial manager or with the help of invited specialists.
After an electronic platform is selected for bidding, all issues related to the sale are resolved only through the site of the selected service. Therefore, together with the owners, it will be determined how applications for participation are submitted, how the price is assigned, and also when the tenders will be held.
The operator of the selected site must be accredited by the arbitration organization.
How is property sold?
The procedure for the sale of property of bankrupt debtors is the same for all citizens. The procedure involves the implementation of several successive stages. Therefore, the sale of property in bankruptcy involves the implementation of actions:
- initially, an independent appraiser evaluates all property held by the debtor;
- values are divided into different categories to determine which items can be sold and which will remain with the owner, as they are his personal belongings or the only housing;
- documentation containing information on the procedure, terms and rules for the sale of values is submitted to the court;
- the nominal value of all items that will be sold at auction is prescribed;
- the date of the auction is set, and the procedure should be implemented within the next 6 months, although this period can be extended by a decision of the arbitral tribunal if there are good reasons;
- jewelry, real estate and luxury goods are sold at public auction;
- if the items are not sold within the prescribed period, they are offered to creditors on account of the payment of debt;
- if the creditors refuse the property, then it shall be returned to the debtor by drawing up the acceptance certificate.
If, after the sale of the values, the citizen still has debts, then they are written off, after which he is declared bankrupt. The procedure for the sale of bankruptcy property is monitored by the appointed financial manager, so it will not be possible to violate the law and avoid bidding by any means.
What will not work to sell?
Before direct bidding, an analysis is made of all property owned by the debtor. The sale of property of bankrupt individuals can be carried out only in relation to certain values, therefore there are items that can not be taken from citizens.
As a result, the debtor is not allowed to remain without a place of residence or personal belongings. Therefore, items not included in the bankruptcy estate:
- products used in household or household goods;
- various awards or medals;
- the only place of residence of a citizen and his family, but the exception will be the situation if such property was purchased in a mortgage;
- various objects and mechanisms used by persons with disabilities;
- tools for the implementation of professional labor, providing income to the citizen;
- livestock and animals, as well as structures intended for their maintenance;
- fuel necessary for heating residential premises during the heating period.
Often there are situations when the managers include prohibited items in the bankruptcy estate. Under such conditions, the correct procedure for the sale of bankrupt property is violated, so a citizen can sue the manager in court. All such cases are individual, therefore their outcome cannot be predicted.
What should creditors do if the debtor has no property?
Sale of property of bankrupt and debtors of Sberbank or other creditors is considered an ideal option for the forced collection of funds from non-payers. But often lenders have to deal with the fact that a particular borrower simply does not have any property that could be sold at auction.
Even under such conditions, a citizen can be declared bankrupt, but the procedure is greatly simplified, since the inventory is compiled promptly and bankruptcy proceedings will not be conducted. All debts of a debtor under these conditions are written off, after which it is officially declared insolvent.
Consequences of hiding property
The procedure for the sale of property of bankrupts and debtors suggests that an inventory of the values belonging to citizens is initially carried out. Often people try in different ways to hide their property or quickly sell or donate it. Such actions are in violation of the law, and therefore lead to significant negative consequences for the debtor. These include:
- a citizen still remains a debtor, therefore, there are obstacles to declaring him bankrupt;
- financial obligations to other companies or individuals are not written off;
- there is a likelihood that bailiffs will begin to act in relation to such a debtor, using many tools that make it possible to collect the necessary amount of funds from the non-payer by force.
If a citizen is declared bankrupt, then he ceases to be a debtor, so all remaining debts are written off.Due to this procedure, it is possible to protect against additional accruals of commissions or lawsuits by the creditors.
The nuances of the process
Every person who plans to declare himself bankrupt should know what the procedure for selling bankrupt property is. The Arbitration Court deals with all matters related to the recognition of people and companies insolvent.
Bankruptcy proceedings can be carried out both in a situation where the debtor is a private person, and under the conditions that the company is a non-payer. The procedure has several differences, but by default it is accompanied by the following nuances:
- the process is initiated only by the financial manager after the person is declared bankrupt by the court;
- a preliminary inventory of the available property is required, and the optimal price of each item is determined;
- at the auction, the most expensive objects represented by real estate or cars are initially sold, and then luxury goods and other items are sold;
- often the funds received after the bidding are still not enough to pay off the debt, therefore debt is debited;
- financial managers receive remuneration for their work, and it depends on the amount of debt and can be from 2 to 7 percent of this value;
- if a person does not have valuable things, then he simply debts are written off, as there is no way to recover from him the necessary amount of funds.
With the help of electronic bidding, bankruptcy property is sold. The trading floor is selected by the financial manager.
What prohibitions apply to the debtor?
Bankruptcy proceedings are held within six months. In this case, the correct procedure for the sale of bankrupt property shall be observed. Bidding is the final stage of this procedure. For the entire duration of the process, certain prohibitive measures are applied to the debtor. These include:
- it is forbidden to leave the territory of the country;
- a citizen cannot dispose of the property, therefore, all operations with him are carried out exclusively by the appointed manager;
- maximum bankruptcy income is left equal to the cost of living for each family member;
- All expenditure transactions are controlled by the manager.
If property is not sold on time, then extension of time is allowed until the last valuable item is sold.
Actions after the sale of property
If the procedure for the sale of property of bankrupt individuals is observed, then at the end of the deadline all property of the debtor will be sold. After that, the following actions are performed:
- determines how much profit has been received after bidding;
- it calculates what remuneration will be paid to the manager, for which the losses incurred by him and the time spent on the procedure are taken into account;
- Calculation of legal costs for the conduct of this case.
After deducting the manager’s remuneration and legal expenses, the citizen’s debts are paid off. For this, funds are transferred to the accounts of creditors, which is provided for by the procedure for the sale of bankrupt property. Bidding allows you to gain a fairly large amount, which is often enough to pay off all debts. If some debts remain, then they are forced to write off.
What debts are impossible to get rid of?
The bankruptcy procedure allows many citizens to really get rid of numerous debts if the procedure for selling the property of bankrupt debtors is followed. But at the same time there are some debts that in any case have to be repaid by a citizen. These include:
- maintenance payments;
- debt arising from utilities;
- compensation for moral damages;
- compensation for harm to the health or life of citizens.
This list may be amended by different regional regulations. For example, a bankrupt must pay the traffic police fines. Therefore, bankruptcy status only allows you to get rid of claims from private lenders and banks. If the lenders still force the bankrupt to transfer the funds, then the citizen can file an application with them to the police or the court.
How are tenders held?
The bidding procedure is standard, and it is handled by the designated manager. They should carry out the sale of bankrupt property. The trading floor is selected by this specialist. After that, the following actions are performed:
- the competitive mass is determined;
- bidding date is set;
- information is published in open sources;
- Applications are accepted from all citizens and companies wishing to participate in the auction, and they must pay an entry fee;
- direct tenders are held, for which all participants can raise the price of various property until it is sold;
- the buyer transfers funds to a specially opened account;
- further participants must pick up the purchased values from the manager.
The procedure for selling bankrupt property may vary slightly from site to site, but the same steps are performed as standard. If it is not possible to sell all the values at one auction, then they can be repeated. The sale of Sberbank bankruptcy property is usually conducted at a site owned by that organization. In this case, you do not have to attract third-party companies.
How is bankruptcy completed?
Debtors and managers must accurately comply with the correct procedure for the sale of bankrupt property. The arbitral tribunal may challenge the process if different errors or significant shortcomings are identified. Therefore, after the end of bidding and settlements with creditors, the following actions are performed:
- a financial manager generates a report;
- it is submitted for approval to the arbitration court;
- other documents are attached to this report, which serve as confirmation of the sale of property owned by a private person;
- a register of creditors' claims is necessarily prepared, which indicates which claims have been repaid;
- after consideration of the report, the court completes the bankruptcy proceedings, for which they are given the appropriate determination, after which the bankruptcy procedure is considered completed.
If the procedure for selling the property of bankrupt individuals is followed, then after the procedure the citizen is released from all other obligations. To him, creditors who have not received their funds, can not present any claims or claims.
Conclusion
Bankruptcy of an individual is considered a complex process, in the implementation of which one often has to resort to bankruptcy proceedings. It involves the realization of values belonging to a citizen. The procedure is performed only by court order. The procedure for the sale of bankruptcy property is monitored by an appointed manager.
After the implementation of the values, the citizen’s debts are repaid. If there is not enough money for this process, then the remaining debts are written off. Therefore, bankruptcy is considered an ideal choice for people who do not have any property. But the consequences of this procedure are not only positive, since after its implementation it is difficult to obtain a new loan and it is impossible to occupy leadership positions for three years.