Consumer bankruptcy and the opportunity of debt relief in German Law

The new German Bankruptcy Law, which was created after long discussions and research, entered into force on 01.01.1999. One of the most important changes made with the New Law that came into force is that natural persons are allowed to get rid of their remaining debts if they fulfill certain conditions within a certain period of time. This opportunity can only be used after a bankruptcy proceeding. The bankruptcy of real persons was also possible in the previous Law, but the long and complex nature of bankruptcy proceedings made it difficult for natural persons to apply for this procedure. The legislator has made it easier for natural person debtors to get rid of their remaining debts by regulating the consumer bankruptcy institution, which is a simpler and faster way of bankruptcy proceedings for natural persons. In a sense, consumer bankruptcy is a stepping stone used by real people who want to get rid of their remaining debts to achieve this result. The natural person debtor requests relief from the balance debts along with the consumer bankruptcy request. If the court that examines the claims and objections, if any, accepts the request to get rid of the remaining debt, the assignment period begins, in which the debtor transfers his seizable income and assets to the trustee and the trustee pays the receivables of the creditors. The bankruptcy court decides that the debtor, who has fulfilled all his/her responsibilities during the assignment period, is relieved of his remaining debts.