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Live in a mess with huge debt for being a bank loan guarantor. Is getting out of bankruptcy a possibility?

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asked on May 27, 2014 at 16:13
by   Worried of my dad
edited on Sep 14, 2017 at 09:57
 
I am posting here as I have googled and seek for similar case like mine for a solution.

My sad case, my father is in his early 50 now. He had 1 car, a house and a small business company. Back to his 20s, he was forced to be guarantor of his boss which he didn't even know what he had signed as they was too many document and he signed multiple times of these document.

Now after so many years when he finally had his own business and almost retiring, the bank came and informed that my dad's ex-boss own them total of almost RM 7 million. That is a huge amount of money that we will never be able to settle.

There are 3 guarantors involved.

However, for some reason, total 3 banks did not take action against the other 2 guarantors or the borrowers but approached my father straight away. My father had no choice. He surrendered by shutting down the company and also returning back his car to Toyota and to file bankruptcy. His bank account which contained RM80,000 had also been frozen.

Things are a mess right now.. He refuses to explain to us or seek for any solution. He says there are no any way to escape from this. As there are 3 creditors (bankers).

I was so frustrated and hope to help them out. I saw my mom washing her face with tears every night. It was heart breaking as my father has 4 more years before he retires and this happened. He said long time ago, the boss is like "samseng" that randomly says things like a bullet is cheap, so is a life of a person.

That's why my father had signed all the guarantor documents. From what I heard my father had been assigned to be director of the borrower's private company and so. BUT please take note that we had never taken or received any money or benefits from the borrower. His ex-boss drove a big fancy car and lives in bungalow while we live in very moderate place and drove a local car.

Now, he is still driving his BMW and has a few factories and lives in big house. Bank did not take anything from him while my father lost everything. We guess that's because he is rich, he did something "behind". One of the other guarantor is the borrower's relative and those banks did not took any action against "her" as well. Only my father...

I really need and want to help him but I just started working, have no high income and have not much savings..

Comes to this desperate time, I hope to get advice from forumer or even lawyer here.

Now, I have few questions:

1. How to avoid having his EPF savings taken away by creditors? How to withdraw the EPF savings without being taken away as they are 3 or 4 creditors who want to take everything from my father.

My father's house is still his and no creditor came to take it away. It has been almost 11 months and I ask my dad what is the status now, he just say that we have to wait.

I am not not sure what we are waiting for and why it took so long and no one claims the house. Is it possible for us to keep the house?

From what my dad said, he's waiting for the government to take action and he might need to attend court again.

If the banks come to take my father’s belonging, will they leave anything for him? He is jobless now and need to live. As the bank had frozen his savings account for 11 months. Won't they leave anything for my father?

If my mom is to open a business, will the banker come and look for my mom for the debt? We have even think of divorce to protect the family. It was so heartbreaking. I need to do something.

For this amount, lets say RM 7 million debt, any possibilities for my father to be discharged from bankruptcy in future? Know that the borrower does not plan to pay money back.

I do not want my father to stay bankrupt until the end of his day.

Sorry for the long story. Thanks for your time. Hopefully I will receive some useful suggestion and advise.
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answered on Jun 3, 2014 at 15:10
by   Worried of my dad
edited Sep 14, 2017 at 09:01
 
I am really happy to hear and received such useful info from you guys. Thanks...

I'm surprise that someone met the same thing and has reply here.. guess we're not alone huh?

Well it was too bad that he can only withdraw maximum 1/3 of his EPF savings.

I did some research... and saw in some posts mentioning there's way to withdraw 100% of EPF savings as EPF cannot be taken away by creditor or banker.. because if they take the EPF, not different of forcing the old and retired bankrupt to "wait for death"..

So which version is truth?... and also they mention never let the EPF savings to be transfered to any saving account as bank will automatically take it...

Hopefully some one who had the same experience can be so kind to advise here...

One more thing is that let's say he did not take the EPF till (touch wood) "pass away one day", will my mom get 100% of it or the creditor or banker will come for it as well?
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answered on Jun 3, 2014 at 17:33
by   vkpc
edited Sep 14, 2017 at 09:02
 
One more thing is that let's say he did not take the EPF till (touch wood) "pass away one day", will my mom get 100% of it or the creditor or banker will come for it as well?
If there is a beneficiary assigned, Jabatan Insolvensi Malaysia (JIM) or any creditor cannot touch the EPF money as EPF will directly bank-in to beneficiary's account.

If no beneficiary is assigned, the EPF money will become part of the estate, which will be very messy as the entire estate will be owned by JIM. It is up to JIM to distribute the funds to creditors.
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answered on Jul 2, 2014 at 04:10
by   justice4fathers
edited Sep 14, 2017 at 09:06
 
Life after bankruptcy or retirement will be as usual. Not the end of the world.

A bankrupt can still work for a living with some restrictions. Can drive a taxi, underemployment, self-employed, be a hawker, school bus, van or private driver, etc, etc.

1. Open a joint savings bank account with your father
2. Register a sole proprietor business under a relative name, open a current bank account, then add your father name as signatory also. Any cheques under your fathers name maybe able to bank into the account.. (it worked for me 10 years ago, but I am not sure it can work like this nowadays)

Remember, stress can kill, trigger off illness, so don't be over-stressed by what is happening.. It is not the end of the world, most important is you keep the family together and be happy, I lost 2 "family value life" because of bankruptcy issues.
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answered on Jul 2, 2014 at 11:21
by   alicia
Being poor is worse than being a bankrupt.
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answered on Oct 3, 2014 at 03:46
by   sunflower shines
edited Sep 14, 2017 at 09:07
 
Dear "Worried of my dad"

Have your father attended any court case yet? What are the latest development? How old are you to go thru all these stresses?

Repost and you "may" get more advices.
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answered on Oct 3, 2014 at 18:05
by   poppy
edited Sep 14, 2017 at 09:12
 
@Jane1963

1.Your hubby can only get 1/3 of his EPF savings, why? Confirmed by EPF Board? Or other reason?
2. How long is he under bankruptcy? When did he withdraw his EPF savings?
3. When is his withdrawal?... recently or few years ago?
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answered on Oct 3, 2014 at 21:24
by   jeff005
edited Sep 14, 2017 at 09:09
 
@poppy

I have replied your questions. Please go to:
https://www.lawyerment.com/answers/questions/9861/guidelines-for-epf-withdrawals-for-bankrupts-and-those-under-bankruptcy-proceedi
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answered on Oct 17, 2014 at 18:26
by   Suzy
Any new updates?
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answered on Oct 20, 2014 at 01:42
by   Jane1963
edited Sep 14, 2017 at 09:13
 
@Poppy

1.Your hubby can only get 1/3 of his EPF savings, why? Confirmed by EPF Board? Or other reason?
Answer: Took all out from Akaun 2.

2. How long is he under bankruptcy? When did he withdraw his EPF savings?
Answer: Bankrupt 2006. Took 2013.

3. When is his withdrawal?... recently or few years ago?
Answer: 2013 (50 years old).
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answered on Oct 29, 2014 at 13:43
by   Worried of my dad
edited Sep 14, 2017 at 09:18
 
I am 23 now. I was forced to stop studying and have to work since my father's business had closed down. Thank you for your concern.

Nope.. it is already one year now. He is still waiting to attend court. His business has been closed down and we had surrendered his car.

Now we are worrying about the house. My mom wants to keep the house. We managed to borrow some from relative to keep the house. Just that we are no sure what to do. We went to Jabatan Insolvensi 3 times and no result. They asked us to either book a time or said they could give us the approval letter for us to negotiate with bank.
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