Hello, this time we will take the time to learn about the eligibility conditions and precautions for applying for personal rehabilitation. If you are looking into personal rehabilitation, you probably have a lot of questions, such as whether you are eligible to apply, how to do it, and whether there are any precautions.
Meaning of personal rehabilitation system
First of all, it is important to know what the personal rehabilitation system means before applying. The personal rehabilitation system has been in effect since 2004. It can be seen as a system for individual debtors who have gone bankrupt due to financial difficulties. So, if you have a lot of debt or are experiencing financial difficulties, it would be appropriate to look into a personal rehabilitation system.
When personal rehabilitation progresses, the state intervenes according to procedures and adjusts the legal relationship with stakeholders such as creditors. And the decision is made while leading the rehabilitation of the debtor while also considering the interests of creditors.
Personal rehabilitation application qualifications
Since this is a system for individuals with large debts, application qualifications are bound to be difficult. Therefore, it is necessary to review whether you are eligible for personal rehabilitation. According to the current regulations, the debtor must be a ‘salary earner’ or a ‘business income earner’ with a certain income. Additionally, the applicant must be an individual who is or is at risk of being insolvent due to excessive debt.
Whether you are eligible to apply for personal rehabilitation requires an expert’s judgment. There may be people who thought it was possible but are not eligible to apply, and conversely, there may be cases where it is possible even if you think you are not eligible. So, please be sure to get a free consultation.
▶ Go to Korea Legal Aid Corporation’s free consultation
Free consultation
Personal rehabilitation qualification precautions
1. There must be a job for the purpose of rehabilitation.
The personal rehabilitation system is not a system that exempts debts, but rather a system for personal economic recovery. Therefore, you can only apply if you have salary or business income.
2. Based on debt amount
If the amount of debt is too excessive, you will be excluded from eligibility for the personal rehabilitation system. Credit debt must be less than KRW 1 billion, and if there is real estate collateral, it must be within a maximum of KRW 1.5 billion and a total of KRW 2.5 billion.
3. Debts must be greater than assets.
Of course, if your assets are greater than your liabilities, you are not eligible to apply for the personal rehabilitation system because you can pay off your debts by selling your assets. It must be calculated including all assets, including real estate and vehicles.
Where to receive free personal rehabilitation consultation
Currently, you can receive free personal rehabilitation legal counseling in your country. Since 2014, the Credit Recovery Committee, the Legal Aid Corporation, and the courts have been working in conjunction with each other to provide consultation on personal rehabilitation and bankruptcy applications. You can receive free consultation, so please check the notes below and be sure to receive consultation. I will leave a link below.
Free consultation 2
▶ Go to Korea Legal Aid Corporation’s free consultation
Free consultation 3
Concluding the article
Above, we have talked about applying for personal rehabilitation qualifications and precautions. As it is a system that is advantageous to the debtor, the qualifications are strict, so you must check carefully. Since you may not be able to get everything you want, it is recommended that you always seek advice from an expert.