NEW out-of-court mechanism

Debt settlement and second chance (laws 4738/2020, 4772/2021 και 4818/2021)

These recent pieces of legislation enable individuals, sole proprietors and companies (legal entities under private law) who do not have the resources to service their debts sustainably, to pursue and succeed their settlement or their entire exemption, by choosing the following three mechanisms and institutions:

• Out-of-court settlement mechanism of debts of natural persons and companies (individuals or legal entities under private law)
• Specialized support at every stage of the application filing, for the successful settlement of your debts
• Settle your debts as a natural person or as a sole proprietorship or as a company, through the new out-of-court debt settlement mechanism

The new out-of-court debt settlement mechanism is a valuable tool in your hands, as it enables you to get rid of most of the debts that come from the past and settle them out of court in a sustainable way, so that you can repay based on the your financial ability.

Away from the courtroom, avoiding time-consuming and proceedings, you can settle your total debts to all your creditors separately or cumulatively (ie banks, leasing companies, business credit agencies, loan and credit management companies, funds, social security institutions, suppliers and third parties) based on your actual financial ability to repay.

The new out-of-court debt settlement mechanism provides proposals for debt restructuring in order to avoid bankruptcy or compulsory collection measures and not to liquidate one’s property.

This procedure ensures the suspension of enforcement proceedings (seizures, prosecutions, etc.), up to 240 installments (20 years) to the public or up to 420 installments (35 years) to financial institutions, write-off of part of the debt based on what it has and what the debtor can pay so that the solution is viable and can be afforded.

In addition to overdue debts, up-to-date or other current debts can be settled, provided the applicant claims that his financial situation has deteriorated by at least 20% (reduction of income by 20% or maintenance of a stable income and increase of expenses by 20%).

For the effective settlement of debts, among others, are included: interest rate reductions, extensions of repayment period, as well as debt “cut”, which can reach up to 75% of the basic debt to the public and social security institutions, while to financial institutions can be reach up to 80% of their requirements.

Sanitation

The consolidation process aims at the maintenance, utilization, restructuring and recovery of the companies with the ratification of the consolidation agreement.

The main goal of the resolution agreement is the restructuring of the debts of the companies to all their creditors (financial institutions, public, social security institutions, suppliers and third parties) which forms a reasonable prospect of their sustainable operation. Any person engaged in business activity can submit an application, if he is present or threatened with failure to fulfill his overdue obligations or if there is simply a possibility of his insolvency, which can be removed by this procedure. This agreement must be accompanied by a business plan with a duration equal to that of the agreement, which has been approved by the contracting creditors. The legally required expert (from the register of experts) prepares a relevant report, which accompanies the application for ratification and in which report sets out his opinion regarding the assistance of the conditions for the ratification of the resolution agreement.

This reorganization process, like the new out-of-court settlement, aims to prevent insolvency and is a very important institution and foundation for companies, which are called to make the most of it.

We offer specialized support throughout the resolution process from the application to the completion of the resolution agreement.

We analyze the future viability of your business

Every healthy business can find itself in temporary, significant or less significant financial difficulties, with causes that either concern it or exogenous and unpredictable factors, such as the current economic and health crisis we are experiencing.

The consolidation process is a tool for overcoming difficulties, rescuing and future development of the business.

Through the consolidation process, a second chance is given to sustainable companies, so that they are free from significant debts so that they can successfully continue their course in the future.

There is also provision for their interim financing and margins for the suspension of individual prosecutions greater than those of the new out-of-court mechanism.

The evaluation of the viability of the company, depending on the type of regulation, is done in two main ways:

In an automatic (standardized) way, based on the financial data of the company and the amount of its debts, applying standardized rules of control and regulation.

By evaluating the viability study of the company, prepared by specialized scientists (economists), with methodical documentation of the financial data of the company now and in the future, in combination with the financial analysis of the business plan that will prove its viability and development. Either way, businesses can document their viability and make adjustments by significantly reducing their debt combined with repaying them in the long run in the future.

Debt relief

The next option provided by the above-mentioned legal texts to the debtor is the debt relief (bankruptcy) which is given to natural or legal persons (companies or companies) when they are unable to fulfill their overdue or non-financial obligations in a general and permanent way, even if there is a threatened failure to meet these obligations. The possibility of debt relief, when both the new out-of-court mechanism and the institution of consolidation can not achieve the overall restructuring of debts at a financially viable level is the last choice of the debtor, as it provides the possibility of debt relief to the public, social security institutions, financial institutions and third parties and effectively marks the write-off of the total debts of the applicant debtor, without depriving him of the immediate exercise of his profession, since of. This institution, which for the first time includes natural persons, aims at debt relief, since the financial situation of the applicant can not support the two previous options provided by law as solutions, so as not to perpetuate a toxic financial situation to his detriment, as his poverty is reduced to the burden of debts and he can not cope sustainably in terms of repayment.

In this case, specialized support is provided at all stages of this process.

Advance Financial Solutions, with serious scientific staff with extensive experience in financial analysis and business development planning, as well as in approaching and understanding the financial problems of individuals, provides you with the best financial services concerning debt settlement and the provision of a second chance, as in the above three optional stages stated by law.

Applying a complete and detailed method, we support you throughout the process of documenting and submitting your application for all procedures.