If I am currently a bankrupt, how do I get myself discharged from bankruptcy?
Discharge of bankruptcy – the general principle
Normally, once you are adjudged a bankrupt, you can apply to the official assignee for discharge via a proposition for settlement.
It is important to note that interest will no longer ‘run’ after you have been adjudged a bankrupt. Interest will only ‘run’ from the date you default and/or judgment in court entered against you until you are adjudged a bankrupt.
The correct procedure is to contact the bankruptcy office within the state where adjudicating order and receiving order was granted in favor of the creditor. Each state will have their own reference number, you cannot go to, for example, a bankruptcy office in Penang if you are adjudged a bankrupt in Selangor.
The Bankruptcy office will call for a ‘creditor’s meeting’ to request all the creditors (may be more than one) to attend this meeting as to whether agreeable to the bankrupt’s proposition settlement.
It is important to note that settlement of 20% of the principle amount due and owing is sometimes acceptable by the relevant creditors!!
The official assignee also has the authority to decide as to the proposition made by the bankrupt if it is found that the creditor is unreasonable or unable to locate the whereabouts of the creditors.
During the period when one is a bankrupt, he has to fill in a form known as ‘statement of affairs’.
If he is never evasive and genuine in his declaration, the official assignee can even agree to a discharge for ‘good behaviour’ and one do not have to pay even a cent!!
You cannot travel overseas unless sanction from the official assignee has been obtained but normally these aren’t serious problems as the official assignee will usually allow such request. The rationale to this is the fear of the bankrupt absconding the country.
