Private bankruptcies in Germany: only 8.3% make use of shortened insolvency proceedings

On 1 July, 2014, a further reform of the insolvency law came into force in Germany. The goal was to enable insolvent consumers to clear their debt faster. For those affected, the reform enables bankruptcy discharge to be completed after three years, under certain conditions. However, 35% of the debt, as well as the legal costs, have to be paid within three years.

For the first time, the credit agency CRIF BÜRGEL has analysed consumer figures on the shortening of bankruptcy discharge procedures to three years. From July 1, 2014 to December 31, 2014, a total of 49,642 private individuals had to file for bankruptcy. 8.3 percent of these (4,111 private persons) managed to shorten their bankruptcy discharge to three years.

CRIF BÜRGEL notes that disproportionately more young people succeed in achieving bankruptcy discharge after three years. This is mainly due to the fact that this group has relatively less debt compared to other groups. Across all age groups, the average debt level is around 33,500 euro. For the under 30s, however, the value is much lower. Here, average debt is just under 15,000 euro. With increasing age, debts increase up to an aver-age of 43,000 euro for German citizens in the age group 61 years and over.

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