Insolvency is an excellent mechanism to use to achieve stability and one does this by using one’s assets to get rid of creditors (sequestration) or to liquidate a company.
There are many tools to use in successful business management, and insolvency is merely one of them when the time is right.
Judgment taken by a creditor is valid for THIRTY years or until the debt has been paid in full.
One can rehabilitate FOUR years after sequestration.
The energy that goes into attempting to deal with creditors that one cannot pay in any case, is energy that should be focused on building a business.
A new entity can be registered and the person can continue with trading whilst liquidating the old company. The whole process should be geared up to holistically to create a new life for your client.
In the base of a business that is liquidated, it does not really affect the person, as he/she can immediately switch entities and carry on with business.
Where a client’s business is successful, but is burdened by too much debt, a quicker road to recovery than dealing with creditors would be to liquidate the Company/Close Corporation or Trust as soon as possible.