Who is eligible for debt adjustment?

There are certain conditions for and impediments to debt adjustment. If you are considering whether you can be granted debt adjustment, please contact the financial and debt counselling services. A financial and debt counsellor will assess your situation and provide further information about debt adjustment. If debt adjustment seems possible, the counsellor will help you apply for it.

The decision to grant debt adjustment is made by a court.

Conditions for debt adjustment

• Your place of residence is Finland or your property and debts are mainly in Finland.
• You are not able to repay all your debts. Your ability to repay your debts has deteriorated due to illness, incapacity to work, unemployment or some other involuntary change in your life situation.
• You have examined whether your debts could be managed in another way.

If you are an entrepreneur or a self-employed person, the following conditions for debt adjustment are applied:

• Your main place of business is in Finland.
• You have examined whether your debts could be managed in another way.
• If you have debts related to a prior pursuit of business, the prior business must have ended for you to be eligible for a debt adjustment.

Impediments to debt adjustment

Certain impediments to debt adjustment have been laid down in legislation. The impediments may be temporary or general: a district court will decide on these as your application is processed. For compelling reasons, a debt adjustment can be granted despite an impediment. Your personal situation is considered in the assessment. Decisions on debt adjustments are made after a holistic deliberation. You can discuss your situation with a financial and debt counsellor.

Temporary impediment

You may have a temporary impediment if your level of income has temporarily decreased. Among other reasons, mandatory military service, maternity or family leave, studies and short-term unemployment constitute a temporary impediment.

If the court deems that a temporary impediment exists and rejects your debt adjustment application, you can re-apply for debt adjustment when the temporary impediment no longer exists.

General impediment

For compelling reasons, a debt adjustment may be granted even if the court deems that a general impediment exists. The following constitute a general impediment to a debt adjustment:

• You have deliberately weakened your financial status or provided false information about your finances for the purposes of being granted a debt adjustment.
• You are subject to a payment liability due to an offence, or you are suspected of or have been charged with an offence that may lead to a payment liability.
• You have incurred a significant debt in the pursuit of a business, and you have materially neglected your statutory obligations for reasons other than your inability to pay.
• The actions that led to your indebtedness can be considered neglectful or irresponsible.
• You have been granted a debt adjustment before and the payment scheme of that debt adjustment has not yet been concluded or less than 13 years have passed since the payment scheme was confirmed.

The court may order the debt adjustment to be commenced if compelling reasons for the commencement exist. A general impediment may extend the duration of the payment scheme.

The court may reject a debt adjustment application if no compelling reasons exist. A general impediment is usually a permanent impediment. You can re-apply for a debt adjustment despite a general impediment if sufficient compelling reasons arise.

Compelling reasons

You may be granted a debt adjustment even if an impediment is deemed to exist by a court. In this case, the court may grant the debt adjustment based on the compelling reasons given. These reasons are laid down in legislation. The court considers the time that has passed since the debt was incurred, other circumstances of the debtor such as health situation and age, the actions you have taken to repay the debt, and the significance of the debt adjustment for both the debtor and the creditor. Granting a debt adjustment is always based on a holistic deliberation when assessing impediments and compelling reasons.