Israeli Bankruptcy Monthly Payment Calculator - Professional Translation

For your convenience, we have developed a calculator that provides an initial assessment of potential monthly payments in Israeli bankruptcy proceedings. It is important to emphasize that this calculator is intended for evaluation purposes only and does not constitute legal advice or serve as a substitute for professional legal consultation. The results obtained are estimates and are not binding on the competent Israeli authorities.

We recommend considering the option of a debt settlement arrangement, which may be a more suitable solution in certain cases. Furthermore, you may be entitled to partial or complete debt forgiveness. Therefore, it is strongly recommended to consult with an attorney specializing in this field, who can analyze your specific situation and propose the optimal solution for you, with possible improvements to the settlement terms.

Israeli bankruptcy proceedings constitute a legal framework that enables individuals experiencing financial distress to reorganize their debts and rehabilitate their financial situation. At the center of this process stands the monthly payment - a fixed monetary amount that the debtor is required to pay each month as part of the economic rehabilitation plan. This article aims to clarify the nature of the monthly payment, how it is determined, and its implications for the debtor under Israeli bankruptcy law.

Person in debt without debt arrangement

The Nature of Monthly Payments in Israeli Bankruptcy Proceedings

The monthly payment constitutes the central axis in the debtor's economic rehabilitation plan. This is the amount determined by the Israeli Execution Office supervisor or the Israeli court, based on an in-depth analysis of the debtor's financial situation. The purpose of the monthly payment is to create a balance between the debtor's ability to repay their debts and the need to enable them to maintain a dignified standard of living.

Criteria for Determining Monthly Payment Amounts

The determination of the monthly payment amount is based on several key parameters under Israeli bankruptcy law:

Income: All sources of the debtor's income, including wages, allowances, and income from assets.

Essential Expenses: Basic living costs, such as housing, food, and essential services.

Family Status: The number of dependents and their financial situation.

Debt Scope: The total amount of debts outstanding for payment.

Future Income Potential: Assessment of the debtor's future earning capacity.

How Israeli Bankruptcy Payments Are Calculated

The calculation of monthly payments in Israeli bankruptcy proceedings is based on the following formula:

Monthly Payment = [(Net Income - Basic Amount - Special Expenses) / 2] × Debtor's Proportional Share

For example, assume a family with a net income of ₪12,500, a basic amount of ₪8,673 (for a couple with 2 children), and special expenses of ₪1,200.

The available income would be: ₪12,500 - ₪8,673 - ₪1,200 = ₪2,627. Half of this amount is ₪1,313.5.

If the debtor earns 52% of the family income, their monthly payment would be: ₪1,313.5 × 0.52 = ₪683.

It is important to remember that this is a preliminary calculation, and the final amount will be determined by the Israeli Execution Office supervisor or the Israeli court, taking into account the unique circumstances of each case.

Advantages of Using the Israeli Bankruptcy Payment Calculator

The payment calculator serves as an effective tool for initial assessment of expected monthly payments. Its advantages include:

Advance Planning: Enables debtors to assess the implications of Israeli bankruptcy proceedings on their financial situation.

Transparency: Clarifies the factors influencing the determination of monthly payments.

Process Preparation: Helps debtors arrive better prepared for meetings with professionals and Israeli authorities.

Debts Not Included in Israeli Bankruptcy Arrangements

It is important to understand that there are certain debts that are not included in Israeli bankruptcy arrangements and cannot be discharged within the proceedings:

Alimony Debts: Maintenance payments to children or former spouses.

Criminal Fines: Fines imposed by Israeli courts in criminal proceedings.

Debts Created Through Fraud: Debts created as a result of fraudulent actions or deception by the debtor.

Certain Government Debts: Such as tax debts created as a result of non-reporting or false reporting.

Strategies for Managing Monthly Payments

The following are several recommendations for effective management of monthly payments:

Strict Budget Management: Careful planning and management of income and expenses.

Income Source Diversification: Examining opportunities to increase income, such as additional work or asset realization.

Expense Reduction: Identifying and reducing non-essential expenses.

Ongoing Communication: Maintaining continuous contact with the Israeli Execution Office supervisor and updating in case of changes in financial situation.

Summary

Israeli bankruptcy proceedings, despite their complexity, constitute an opportunity for financial rehabilitation and opening a new chapter. A deep understanding of the monthly payment mechanism, together with intelligent use of tools such as the assessment calculator, can assist in successful navigation of the process. However, it is important to emphasize that each case is unique, and therefore it is recommended to consult with qualified professionals for personalized advice.

Israeli debtors should note that unlike other countries, Israeli bankruptcy law requires careful consideration of family circumstances and provides specific protections for essential living expenses. Through a responsible approach, careful planning, and persistence, it is possible to overcome the challenges involved in Israeli bankruptcy proceedings and lay the foundations for a more stable financial future.

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