Personal bankruptcy law allows, within certain jurisdictions, a person is declared bankrupt. Almost every country with a modern legal system displays some form of debt relief for the individual. Personal bankruptcy is distinguished from corporate bankruptcy.
Video Personal bankruptcy
By country
DICE 2006 report from Ifo Economic Research Munich compares international personal bankruptcy in selected OECD countries.
United States
In the United States, the same chapters of the Bankruptcy Code apply both in personal and corporate bankruptcy. Most individuals who enter bankruptcy do so under Chapter 13 ("reorganization" plan) or Chapter 7 ("liquidation" of the debtor's assets). More rarely, personal bankruptcy proceedings are conducted under Chapter 11. The ultimate goal of personal bankruptcy, from the viewpoint of the debtor, is to accept the release.
Canada
The concept behind bankruptcy in Canada is that someone assigns (all) what they have to the trustee in bankruptcy in exchange for the abolition of their unsecured debt.
The rules for filing for personal bankruptcy in every province and region are slightly different. In some areas of Canada, individuals may be allowed to keep (exclude) certain properties. General items for exemptions include clothing, furniture, appliances, motor vehicles, medical and dental aids, home, family heirlooms, and some insurance. In basic terms, any property that may be required by the debtor to survive may be waived. Personal bankruptcy will eliminate most, if not all, individual debt, but also affect their future ability to get credit.
The cost of personal bankruptcy in Canada depends on individual family monthly income, family size, and their assets (such as RRSP). The alternative to personal bankruptcy (in Canada) is the Consumer Proposal. Another option in Canada is debt consolidation. No matter which option they choose, they can often turn into a trustee in bankruptcy for a free consultation.
Israel
Personal bankruptcy in Israel is governed by the Bankruptcy Act, 1980. Debtors and their creditors may apply to court for bankruptcy. If given, stay automatically enforced and a wali (often the Official Receiver) is appointed to the debtor's assets. Automatic stay does not preclude enforcement of creditors lien lien. The bona fide debtor usually receives either immediate exemption (if they practically have no assets) or within a few months to several years from the beginning of the process (during which time most debtors are required to pay a fixed amount, as determined by the court, that goes towards paying creditors). Since 1996, Israel's personal bankruptcy laws have shifted to a relatively debt-free regime, unlike the American model.
Maps Personal bankruptcy
References
Source of the article : Wikipedia
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