The bankruptcy process is only initiated if the bailiff has not been able to collect the debt after freezing the borrower’s assets and accounts while the borrower still has marketable assets. Servicer will either initiate the bankruptcy process on its own or join an existing bankruptcy filing.
Bondora and Servicer have only been involved in a limited number of bankruptcy cases over the past five years. Personal bankruptcy is not common in continental Europe, as discharging debt may take up to seven years, depending on the country. Consequently, borrowers with marketable assets and recovery potential typically prefer to repay debt under a new payment plan rather than opt for a bankruptcy process. The bankruptcy process does not yield any additional benefits where borrowers without marketable assets are involved.