Bankruptcy in Israel – What it's really like
- The current legislation of the Israeli government gives attention and provides a line of solutions, to the matter of debt erasure. The law extends to Israeli citizens (including those living abroad), and also to temporary residents living in the territory of Israel and/or those who engage in commercial activities in Israel and those who are unable to satisfy in full, the claims of creditors on monetary obligations.
2. According to the Order of Bankruptcy (1980), an individual of 18 years or older (in some cases even younger), unable to pay his debts equivalent to the sum of $4,500 and higher, has the legal right to appeal and demand, from the relevant authority (district court), to declare him bankrupt.
3. The statistics in Israel count nearly 12,000 cases of bankruptcy every year, this procedure is usually the most effective for debtors and allows them to start life from a new page.
Important to know:
4. The western society of today is based on cruel laws of capitalism on one hand and cares about the rights of the individual on the other, extremely interested in the maximum financial productivity of every member (including bankrupt individuals).
5. This way, bankruptcy, caused by the above mentioned principles, is a necessary and simple solution towards debt erasure for individual members of society who got into a difficult financial situation.
An ordinary situation:
6. The overwhelming number of individuals who are not able to resolve financial obligations on their own are under persistent harassment from creditors, which in turn restrict the rights of the debtor, including bank account foreclosure, limitation of the driver’s license, seizure of salary, prohibition from leaving the country, seizure of property etc., usually resorting to services of a bankruptcy lawyer with the aim of resolving a financial matter through bankruptcy and obtaining appropriate protection.
Protecting the debtor’s rights in the bankruptcy process:
7. A debtor filing an application to the court to declare himself bankrupt (as mentioned in paragraph 2) and received a relevant order, falls under the protection of the bankruptcy order (1980) (Israel).
8. This way, the state assumes the authority of all individual creditors and, first of all, mandatorily abolishes, regardless of the size of the total debt, all restrictions and sanctions applied by individual creditors.
Life shows that no one is safe from such situations, and the first thing you should do, if you are thinking about erasing debts, is to consult a bankruptcy lawyer. There often are alternative ways of solving the issues of debtors and creditors that are less time-consuming and more efficient. You can ask questions by calling us or leaving a message.
*The above article is by no means a legal advice; any use of this information is solely under the reader’s responsibility.