Sequestration may be the best option if you are living in South Africa and struggle to pay your debts.

If you are behind on mortgage and vehicle payments or your vehicles have already been repossessed, you have judgments against you or you are on the verge of being unable to pay for any of your major accounts, then sequestration may just be the answer.

You are not the only over-indebted individual. Well over 10 million of the 19 million consumers in the country who are credit active are over-indebted. Sequestration, however, is best suited for people who have considerable debt that cannot be repaid within 24-60 months, and have enough assets to ensure that creditors can receive their benefits through voluntary surrendering of the debtor’s estate.

If you are insolvent, your liabilities exceed your assets. To apply for the official insolvent or bankrupt status, you need to apply to the High Court. Once the High Court grants the order, your debt is written off. However, you will surrender your estate in order to do so. The High Court will appoint the curator who will then wind up the estate and distribute the benefits to the creditors. This means that you will lose your house in the process, but you will have enough time to find a new residence and you will be debt free at the end of the day.

Note that your children’s toys and belongings are not included in the estate. Even though you will have to surrender the furniture, it is possible to buy such back from the estate at a very low price. It is also possible to make an arrangement to ensure that you can buy your vehicle back, depending on the particular sequestration circumstances. You will not lose your tools of trade.

The creditors cannot harass you any longer and the phone calls will thus stop. Once the sequestration process is completed, you will be debt free and thus able to rebuild your financial wealth without constant harassment from creditors. Note that you can either voluntary surrender your estate or creditors can apply to force sequestration. It is always better to do so voluntary, as the curator is normally more positive towards you.

You will submit an affidavit to explain the reason for applying for voluntary sequestration. Our attorneys will draft the affidavit and will represent you in court. You will not have to appear in court. The court will grant the order on the first date and this is called the provisional order. The case will appear before court about a month later. In the meantime, the creditors will receive notice about the return date and can oppose the application. Where no opposition exists, the order is finalised and the sequestration takes place.

Once sequestrated, you are free of debt and you can apply for rehabilitation status. Note that sequestration is a complex legal process requiring professional legal assistance. With our professional help, you will be able to benefit from the process and become completely debt-free.