In Singapore, consumers undergo the liquidation process to settle their debts. The process allows them to seek assistance through the court to sell their assets to pay off their debts. However, this process can credit lasting effects on the consumer and their future aspirations. The following is an assessment of how the liquidation process affects these consumers in Singapore.
No New Lines of Credit
During the liquidation process, the consumer isn’t allowed to start any new lines of credit. They cannot acquire a short-term loan, new credit card accounts, or acquire any type of financing. If they attempt to start a new line of credit, they can face serious penalties, and their liquidation case is stopped completely.
The Bankruptcy on the Credit Report
Creditors update the consumer’s credit report when their accounts are paid off. While this is beneficial, it doesn’t mitigate risks associated with the bankruptcy listing. This listing will lower the consumer’s credit score. This can prevent them from opening new lines of credit based on this score. The listing for the bankruptcy can remain on the credit report for up to ten years. This can stop the consumer from purchasing a new home or automobile for many years.
Payment of Non-Discharged Debts
After the liquidation process, the consumer is required to pay off all debts that were included in the liquidation or were discharged. They must follow these requirements to avoid legal action by creditors. The consumer isn’t protected through the liquidation process against these creditors.
Rebuilding the Credit
The consumer can follow programs to help them to rebuild their credit. This could include short or long-term loans that can increase the credit score. The consumer can learn more about these opportunities through credit counseling programs that are available to these consumers locally.
In Singapore, consumers undergo the liquidation process to end their debts. The process helps them to sell assets to become debt free. It can also eliminate a larger volume of debts in a short amount of time. This could help them to manage their finances more effectively. Consumers who need help with this process contact liquidation lawyers in Singapore today.