Archive for the ‘SEQUESTRATIONS/LIQUIDATIONS’ Category
SEQUESTRATIONS / LIQUIDATIONS
October 26th, 2010 | 
Author: VOLUNTARY / SEQUESTRATIONS
(LIQUIDATIONS – point 2)
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SEQUESTRATION / SURRENDERING YOUR ESTATE – WHAT YOU SHOULD KNOW
The Surrendering of Your Estate in terms of the Insolvency Law entails an application instituted in the High Court. This application may be Applied for by Persons who are No longer Able to Pay their Debts due To circumstances Out of Their control. We Can only Help You if you are the Registered Owner of an Immovable Property i.e House or Erf.
A surrender Enables You to Live a Normal Financial Life (Debt Free) – where you are Not Plagued by Arrear Debts with high interest rates. You will have No More Fears that Creditors will phone you day and night from “private numbers” and you can answer your calls fearlessly. The Sheriff May No Longer Hassle You !
WHAT IS THE PROCEDURE FOR SEQUESTRATION/SURRENDER OF ESTATE?
1. The “Surrender of Estate information form” is completed.
2. We then start the Application by publishing an advert in the Government Gazette and the Citizen. This advert Legally Stops Any Sheriff’s Execution Auction on Your Movable and Immovable Property,
3. The Application is drafted based on the information supplied by you. This Application for Sequestration has to be signed before a Commissioner of Oaths within 7 working days ( the obligation to arrange for the signing thereof rests with you ). This document lies for inspection by creditors at the Master of the High Court and the local Magistrates Court for 14 days.
4. During this time all your Creditors gets Notified of the application for Sequestration by registered post. If the Creditors won’t stop bugging you, We Will Also Provide You with a Copy of this Notice as Proof to be sent to them. The South African Revenue Services also gets notified, even if you are not registered with SARS. Also note that if you are employed, your Employer will Never Get Involved or be Notified for your Sequesration application , as this is Your Personal Matter.
5. The day of the Court application an Advocate will Appear on Your Behalf. You Do Not Have to Attend Court.
6. After the application has been Approved and Granted by the Court, a Curator is appointed to handle all Financial Matters on Your Behalf. He will deal with all the Assets and Liabilities and might arrange a consultation to explain the details to you.
IMMOVABLE PROPERTY
7. If your property is in the process of being sold in execution ( by the Sheriff of the Court ), and you can not make arrangements with the bondholder, it is important that the process should be set in motion as soon as possible. We can only Guarantee the stopping of the Auction once your application has been printed in the Government Gazette which is printed every Friday of the week. If your auction has already taken place we May Still Be Able to Help You.
8. Once your Sequestration / Application for Surrendering of Your Estate have been granted by Court a Curator will be appointed by the Master of the High Court. He will then try to sell the property out of hand by giving Estate agents instruction to sell the property. When he gets it sold You will Not be held liable for any shortfall on the bond.
**It will take several months for the Curator to be appointed and for him to get the property sold. This means that you will be staying in the house for approximately six months without paying a bond premium. You need only pay the electricity bill, so that you do not find yourself “in the dark”. Once the property is sold you will get at least 30 days notice to vacate.
WHAT HAPPENS IF I AM IN ARREARS WITH MY BOND
RE-PAYMENTS?
(This legal procedure can only be stopped if the arrears on the bond is paid in full and you have made arrangements with the bondholder which is acceptable to them or if Application for the Surrender of your Estate is made as explained herewith)
10. Once you are in arrears the Bank will instruct their Attorneys to institute legal action against you. The procedures that they follow are briefly as follows;
- Summons will be issued in the High Court for re-payment of your full outstanding bond amount;
- Unless the amount is paid, Judgement and a warrant of Execution will be issued against you 10 days later. This Judgement will mean that you will be automatically black listed for 30 years, during which time you would not be able to make any credit or buy another house;
- You will receive a “Notice of Attachment” from the Sheriff of the Court indicating that your house is attached and is to be sold on Execution Auction; this takes 3 – 4 weeks. This Auction is a public Auction held at the office of the Sheriff and is held without a reserve price which means that it is, considering the current bad property market, likely to be bought back by the Bondholder for as little as R 100-00. You may also be given 24 hours to vacate the house.
- You are now liable for the shortfall outstanding which is likely to amount to hundreds of thousands of rands. For this outstanding debt they will attach, remove and sell all your remaining assets like your furniture.
- Now you will be served with a subpoena by the Sheriff to appear in the Debtors Court so that you salary and / or income may be attached or garnished. In other words you will now be paying for a house which you don’t have anymore, most likely for the rest of your life as this debt still accrues interest. DON’T ALLOW THIS TO HAPPEN TO YOU!
IF I APPLY FOR SEQUESTRATION / THE SURRENDER OF MY ESTATE, WHAT WOULD THEN HAPPEN?
- Once your Court Order is granted:
ADVANTAGES
- All Your Debts will be Written Off and Your Salary (if any) and Other Income is Still Your Own and You do Not have to pay any creditor;
- You will be able to Stay in the House for approximately 6 months Without paying the Bank
- You will be afforded Opportunity to Keep Your Furniture by buying it from the estate at a Minimal Amount, the amount to be calculated by the curator.
- Only your Creditors are notified of the process and not your Employer there will also be an advert in the Government gazette and Citizen.
- You will Not have to attend Court.
- Your salary Cannot be attached or garnished and all existing garnishing orders must be Cancelled;
- After 4 years you apply to Court for a Rehabilitation Court Order which means that Your Credit Rating is Re-instated Completely. You can now after only 4 years, Buy another House and make Credit
DISADVANTAGE
- During this 4 years you may not apply for credit; ( you would not have been able to anyway because of the Judgement – valid for 30 years )
- You may not be a Member of a Close Corporation or Director of a Company
WHAT HAPPENS TO MY VEHICLE?
If your vehicle is subject to a Hire Purchase agreement, you may loose the vehicle.
- If a vehicle is under lease purchase, the vehicle should be safe, if the instalments are up to date;
- If the vehicle is already registered in someone else’s name and you only pay the instalments on the vehicle, there is no danger of losing the vehicle.
WHAT IS THE FEES FOR THE APPLICATION / SEQUESTRATION ?
We receive our fee for the application from the Curator once we were successful with your application. You are however liable for only the disbursements for the application which are for example;
- Advocates fee who attends Court on your behalf; ( we will never let our clients go through the humility of attending Court themselves, we understand that you are very nervous at this time and we would not want to place any more pressure on you by expecting you to attend Court)
- The Government Gazette’s costs, Citizen, Sworn valuer, registered mail that is sent to your creditors, telephone calls, faxes to creditors that we send on your behalf etc.
We will quote the amount of the expenses as it will differ from application to application depending on the value of the property. You may even arrange for an extension of the payment thereof.
2. LIQUIDATIONS
Liquidation - When a business fails and is unable to pay its debts it is usually placed in liquidation. A liquidator will take charge of the estate and all of the business assets are sold by way of public auction. In many instances these auctions do not generate enough cash to pay back the debts and therefore the credit providers look to the personal sureties (usually the directors or members of the business) to pay the remainder of the outstanding debt.
Why choose liquidation?
Liquidation is the only way to fully wind up the affairs of a company and end its existence – as opposed to just selling the company’s assets and paying its debts which leaves the company in existence. Having an independent party act as liquidator to undertake the process protects creditors’, directors’ and members’ interests while the company structure is dismantled
If the directors or members cannot settle the outstanding debts, then they have the option of including these debts under Debt Review or applying for Sequestration in their personal capacity.
We Assure You that we, Will at all times, be Honest in our advices to you and that we Will Handle your situation with Discretion and Consideration.
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