velkajärjestelylain

Velkajärjestelylaki, formally known as the Act on Arrangement of the Debts of a Private Individual (laki yksityishenkilön velkajärjestelystä), is a Finnish law that provides a legal framework for individuals who are unable to meet their debt obligations. The primary purpose of the law is to offer a structured process for debtors to manage their overwhelming debts and achieve a fresh start financially.

The velkajärjestelylaki allows individuals who are permanently or foreseeably permanently insolvent to apply for debt restructuring. This typically involves a court-supervised process where a debt arrangement plan is created. The plan outlines how the debtor will repay a portion of their debts over a period, usually five years, while the remaining debt may be waived.

To be eligible for debt restructuring, an individual must demonstrate that their financial difficulties are not temporary and that they have made reasonable efforts to manage their finances. The law also considers the debtor's ability to work and earn income. During the debt arrangement period, the debtor is generally restricted in their ability to incur new debt.

The process is initiated by the debtor filing an application with the district court. The court then assesses the applicant's financial situation, including income, assets, and liabilities. If the criteria are met, the court appoints an administrator to oversee the debt arrangement process and negotiate with creditors. The goal is to find a solution that is fair to both the debtor and the creditors, enabling the debtor to become economically independent again.