KDNP drafts family bankruptcy bill

Budapest, January 20 (MTI) – The co-ruling Christian Democrats (KDNP) have drafted a bill that would introduce family bankruptcy in Hungary, the human resources ministry’s state secretary said on Tuesday.

The draft has been submitted to the justice ministry, Bence Retvari, the deputy leader of KDNP, told public TV’s morning programme.

The bill was drafted after parliament had passed in November last year legislation on the conversion of foreign currency loans into forint ones in an effort to help loan holders, Retvari said.

The measure made the country’s retail lending stock manageable, he added.

The family bankruptcy legislation aims to help Hungarians who have accumulated a few million forints worth of debt, but whose debts exceed their assets and their expected income, Retvari said.

Under the legislation a team of experts would help families with a loan put together a financial plan as well as reach an agreement with creditors on writing off part of the loan, he added.

Retvari noted that lenders today often sell their bad loans to factoring companies at 30-40 percent of book value, while the factors try to collect on 100 percent of the loans.

It is hoped that, after consultations, the family bankruptcy legislation can come into force in early 2016, he said.

Source: http://mtva.hu/hu/hungary-matters