The process commences when an individual, burdened by unsecured debts exceeding SGD 15,000, files a bankruptcy application with the Official Assignee (OA), a government-appointed officer overseeing bankruptcy proceedings.

Upon acceptance of the application, a bankruptcy order is issued, officially declaring the individual as bankrupt. The OA assumes control of the debtor’s assets, including bank accounts, investments, and real estate.

The OA’s pivotal role is to liquidate the debtor’s non-exempt assets, using the proceeds to repay creditors. Exempt assets, typically essential personal belongings and tools of trade, remain protected from liquidation.

Debtors may be required to make monthly income contributions based on their financial circumstances. These contributions serve as a source for repaying creditors over a specified duration.

Personal bankruptcy typically spans up to five years. During this period, debtors face restrictions, and their financial affairs are closely monitored by the OA.

Upon successful fulfilment of the bankruptcy terms, debtors receive a discharge from bankruptcy. This signifies the forgiveness of remaining unsecured debts, offering individuals a fresh financial beginning.

It’s crucial to acknowledge the significant credit consequences associated with bankruptcy. A bankruptcy record remains on an individual’s credit report for an extended period, hindering their ability to access credit, secure housing, or pursue specific professions.

Prior to pursuing bankruptcy, individuals in Singapore are strongly encouraged to explore alternative debt management solutions, including debt repayment plans, debt consolidation, and negotiations with creditors. These alternatives may help avoid the enduring credit repercussions linked to bankruptcy.

Given the intricacies of bankruptcy proceedings, many individuals seek legal counsel to navigate the process proficiently and safeguard their legal rights.