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"We live in a developed society whose economic model is based on credit expansion as the main engine for generating private wealth."

This is the premise on which the thesis of 'The indebtedness of the individual in Spain', defended at the Catholic University of Murcia by Dr. José María García and Rodríguez, and which states that "of all foreclosures handled during 2012, only in 2.24% of cases, the Code of Good Banking Practice could be applied ";

which as pointed García reflects the legislation that exists to failure the individual in case you can not meet its financial commitments.

In the thesis, which has received the highest rating, José María García goes one goes further into the matter and ensure that the problem of the insolvency of a citizen becomes the medium to long term in a general economic problem.

"That is, the insolvency affecting the economy of the countries to drain liquidity from the banks, reduce consumption and generate uncertainty for foreign investors."

Legislative initiative

The author not only limited in their work to identify factors that affect the indebtedness of citizens, but also poses the thesis the development of a Draft Law of the Bankruptcy Code of Individuals.

This collects two steps to the insolvency of a citizen: the conciliatory and judicial.

The first refers to the reconciliation between the debtor and its creditors, which is set prior to the next phase requirement, "and bet on the existence of a system of conciliation over existing alternative mediation" qualifies Doctor, which also raises the need for proper formation of the Conciliation Commissions shall ensure that the parties reach an agreement.

"Otherwise, issue a viability plan or settlement which may become binding if the parties who voted in favor of the same court and request a court deems it appropriate," says José María García Rodríguez in his thesis.

The second phase will establish an independent insolvency proceedings and nationally, only judicial proceeding in which the judge will have broad civil powers to make decisions without the agreement of the parties concerning a possible viability plan or settlement the debtor's assets.

Ensuring social protection

As recorded by the new doctor, the Spanish Constitution requires, among other duties, for the government to ensure social, economic and legal protection of the family (article. 39.1 EC) in its social and economic policy, and to ensure respect "hardly, can fulfill this obligation if during the last 6 years have not been offered realistic and fair to the situation of over-indebtedness in individuals and the destruction of personal wealth socioeconomic solutions."

Source: UCAM