Will I lose all my as­sets?

Simply Her (Singapore) - - Beauty News -

Last year, al­most 400 women in Sin­ga­pore re­ceived Bank­ruptcy Or­ders – 145 of whom were aged be­tween 41 and 50. Low in­come or over­spend­ing were the most com­mon rea­sons cited when they filed for in­sol­vency, although some chalked it up to busi­ness fail­ure, spec­u­la­tion or gam­bling, and un­em­ploy­ment or li­a­bil­ity as a guar­an­tor.

What is bank­ruptcy?

It is a le­gal sta­tus de­clared by the High Court when an in­di­vid­ual can­not re­pay debts of $10,000 or more – this may be raised to $15,000 if changes pro­posed re­cently by the Min­istry of Law are passed. You can file for bank­ruptcy or your cred­i­tor, such as your bank, may ap­ply to the High Court to is­sue a Bank­ruptcy Or­der against you.

If you’ve been of­fi­cially de­clared bank­rupt, an Of­fi­cial As­signee will be tasked to sort out your fi­nan­cial af­fairs. The first thing you have to do is fill out a State­ment of Af­fairs form within 21 days from the day your Bank­ruptcy Or­der was made. This in­cludes your per­sonal de­tails, as­sets and li­a­bil­i­ties, even your chil­dren’s in­come (if any). If you gave away or sold any as­sets within the last five years be­fore your Bank­ruptcy Or­der was made, de­tails on the es­ti­mated worth must also be pro­vided.

Your Of­fi­cial As­signee will help


you sort out how to clear your debt, which usu­ally in­volves selling off your as­sets, reg­is­ter­ing your cred­i­tors’ claims and dis­tribut­ing your div­i­dends to your cred­i­tors.

Be care­ful not to omit any de­tails or pro­vide false in­for­ma­tion in your state­ment or you could face a fine of up to $10,000 and/or up to two years’ jail. Any­thing valu­able that you own be­fore the Bank­ruptcy Or­der was is­sued and any­thing you bought or that was gifted to you be­fore you are dis­charged from bank­ruptcy must be sur­ren­dered to the Of­fi­cial As­signee. This in­cludes all lo­cal and for­eign prop­er­ties and bank ac­counts, se­cu­ri­ties, ben­e­fi­cial in­ter­est (ben­e­fits on as­sets owned by another party, like if you were the ben­e­fi­ciary of a trust fund), ve­hi­cles, in­sur­ance poli­cies, safe de­posit box con­tents and even telecom­mu­ni­ca­tions equip­ment pur­chased un­der your name.

How­ever, there are some as­sets that are pro­tected from your cred­i­tors, like a pri­vate prop­erty held in trust for some­one else, which means it doesn’t be­long to you. Items deemed “nec­es­sary and not ex­trav­a­gant”, such as fur­ni­ture and per­sonal ef­fects like clothes and shoes, can also be kept, as can trade tools that you’ll need to make a liv­ing and pay off your debt. You also get to keep your HDB flat if at least one of the own­ers is a Sin­ga­porean, your Cen­tral Prov­i­dent Fund (CPF) ac­counts’ monies, and any life in­sur­ance poli­cies where your spouse or chil­dren are named ben­e­fi­cia­ries. Also safe are com­pen­sa­tion for per­sonal in­jury or wrong­ful act suits.

But any pay­out un­der the De­pen­dants’ Pro­tec­tion Scheme will go to­wards pay­ing off your cred­i­tors, un­less you’re the one in­sured and the com­pen­sa­tion is for your per­ma­nent in­ca­pac­ity, mean­ing you do not have the phys­i­cal or men­tal ca­pac­ity to be em­ployed. Even then, CPF or the pri­vate in­surer will need to seek the Of­fi­cial As­signee’s con­sent be­fore re­leas­ing any funds to you.

If you have any se­cured as­set – any as­set put up as col­lat­eral with the bank when you take up a loan, such as your prop­erty or car – the bank gets first dibs to sell it off and re­cover what you owe them. Any­thing in ex­cess of that goes back to the Of­fi­cial As­signee to pay off other cred­i­tors.

If a Bank­ruptcy Or­der has been made against me, do I still have to re­pay my debt?

Yes. In the State­ment of Af­fairs form, you’ll need to de­clare how much you can re­pay ev­ery month, and any lump­sum re­pay­ments you make. If you are un­em­ployed and can’t re­pay your debt, you will need to pro­vide proof in the form of a let­ter of ter­mi­na­tion,

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