Insolvency of Estates – What is It?

The death of a person who was close to us is always a heavy burden. No matter whether it was already foreseeable that a person would not have long to live or whether it was a surprising stroke of fate, the situation is never easy for the relatives. The death of a person is usually not only connected with incriminating grief, but the topic of inheritance must also be dealt with. There are the most different situations: Some people have already thought about who should inherit which shares before their death and other people have not thought about it or have had no more time to deal with the topic because they were surprised by a stroke of fate.

Legal or Voluntary Succession?

First of all, you should know what the difference is between a legal and a voluntary succession. Basically, it is important to know that the arbitrary succession always takes precedence over the legal succession. We speak of an arbitrary succession when the deceased has left a will by determining which heirs are to inherit what. In this context, heirs can be all natural persons. The heirs therefore do not have to be related to the deceased.

The legal succession always comes into effect if the deceased person has not left a will or a testamentary disposition. The legal succession is defined in the Civil Code and refers to three grounds of appeal: kinship, marriage and citizenship.

• Voluntary succession: the deceased person has left a will that specifies who inherits what
• Legal succession: Deceased person has not left a will. The grounds of appeal: kinship, marriage and citizenship are included.

Inherited debts – the Negative Side

But it is not always the case that heirs inherit great wealth. If the deceased had open debts to creditors and was liable with his inheritance, then the creditors can claim them from the heirs. Even the heirs’ own property is not protected in such a situation. You must expect to have to pay the debts of your relative or spouse. But what can you do if such an inheritance would drive you to ruin? If you are unable to settle the debts of your relative or partner under any circumstances, there is a way out of this situation.

This is where the word estate insolvency comes into play. But what is that actually? How does something like this work exactly? What are the prerequisites for an estate insolvency?

Insolvency of Estates: Requirements, Procedure & Proceedings

The aim of a petition for bankruptcy is to protect one’s own assets from being accessed by the creditors of the deceased person. So far, so good, but how exactly does the procedure work now? An application for composition insolvency must always be filed with the competent insolvency court. If the proceedings are initiated, the insolvency debtor still has to stand in for the inheritance, but he no longer runs the risk of being liable for the debts of the deceased with his own assets. In this situation, the insolvency debtor only has to use his estate to pay outstanding debts.

• The application must be submitted to the competent insolvency administrator

There are two possible conditions for the opening of an estate insolvency:

• Overindebtedness of the estate
• Insolvency of the estate

Now you will learn how it all works. Once you have successfuly filed the petition for composition insolvency, the work of the insolvency administrator begins. The task of the insolvency administrator is to list the outstanding debts and to contact the creditors in order to develop repayment proposals. It is often the case that the outstanding debts cannot be paid with the estate. If this is the case, it is the task of the insolvency administrator to make arrangements with the creditors. The aim of this administration is to ensure that as many debts as possible can be settled.

If you find yourself in such a situation, it is important that you file the petition as soon as you know that you are not able to pay the debts of the deceased. As soon as you know this, you are obliged to file a petition with the bankruptcy court. Inform yourself in time and you will be saved many costs.

Special: Real Estate & Corona – Updates

More articles and analysis on real estate in the Corona Crisis:

• Demand increases (Google Trends): Real estate sales
• Is the real estate bubble bursting? Price development
• Housing bubble, what does that mean?
• COVID-19: Coronavirus Meaning

Analysis and evaluation: Real estate key figures

We already reported a few weeks ago, is Corona bursting the 2nd real estate bubble?

What do the trends say? Together with our online marketing expert, we set about analysing the current queries. A large proportion of search queries in Germany are made via Google, just under 90%. Accordingly, a lot can be read from the data that Google provides.

Data collection by means of trends (search queries)

A special tool for analyzing demand is Google Trends. Google Trends looks at the search behavior of certain cities, states, countries but also worldwide. Thus, trends can be identified early but also long-term conclusions can be drawn.

Parameters (search terms)

For our trend study, we looked at the following questions in particular:

1. Sell property
2. Apartment / condominium for sale
3. Sell house / detached house
4. Sell apartment house

How has demand developed over the last 12 months and what is the trend for the next 30 days?

Increased interest also in the Longtail

Additionally, we have an insight from our own online statistics. This looks at the “long tail”, which means search results on page 2, 3, 4 on Google. The more users not only stay on page 1, but click further, the higher the current interest in a topic seems to be. They are apparently looking for further, more detailed or simply more information, therefore go from page 1 also on page 2, 3 and 4.

Factor: Valuation

For the evaluation, we used a comparison period of 12 months. The value 100 represents the highest search volume within the last 12 months.

Selling real estate: Results

The trend analysis in the field of real estate sales (08/20) deals with the increasing demand. Very directly visible, among others on the main keyword “sell property”. The charts and the review of the last 12 months can be found below.

Moderately increased, on average only 2 to 3 points, are the sale of house and condominium. So here there seems to be no big changes in the amount of search queries yet.

Very noticeable, on the other hand, is the trend on the topic of “selling multi-family houses”. As you will see in the individual analyses and charts, the trend is jumping upwards these days.

Likewise extreme increase registers “real estate sell”

• +/ – Stagnant: “Sell house”, “Sell apartment”.
• + Rising: “Sell property”
• ++ Strongly increasing: “Sell apartment house”

Selling Real Estate: Analysis and infographic

Sell house, sell apartment, added together, an increase on average of no more than 2 (possible 100). The demand on the subject of “selling real estate”, however, goes strongly upwards. In the comparison period of the last 12 months from the factor 26 to meanwhile 79 / 100.

• Search Keyword: sell real estate
• Period: 12 months (07/19-07/20)
• Portal: Google Trends

Who wants to sell their property?

Brandenburg and Hamburg are at the top of the list when it comes to the amount of searches. Also very interesting, the south is far ahead, with Bavaria and Baden-Württemberg. Here, the ownership rate is also the very highest. Read more about real estate statistics here.

1. Brandenburg
2. Hamburg
3. Thuringia
4. Baden-Württemberg
5. Bavaria

Selling a House: Analysis and infographic

Before we move on to the analysis regarding multifamily housing, let’s take a look at the smaller households, or owners of single-family homes and townhomes. The movements have increased only moderately, on average by 2 to 3 points. No extreme changes on a scale of 100. In between, the inquiries were even below the typical average.

• Search Keyword: Haus verkaufen
• Period: 12 months (07/19-07/20)
• Portal: Google Trends

Selling an apartment: Analysis and infographic

Also in the area of apartment or condominium sales, the increases are very moderate. Here, too, the average is 3 to 4 points, viewed in the short term. In the comparative period of the last 12 months, the demand even decreases slightly, related to July-December 2019, compared to January-July 2020.

• Search Keyword: sell apartment
• Period: 12 months (07/19-07/20)
• Portal: Google Trends

Selling multifamily housing: Extreme increase

The trend curve then explodes but formally on the subject of multi-family house sale. As you can see in particular in the rash of the current days, there seems to be a significantly increased interest among property owners.

• Search Keyword: Mehrfamilienhaus verkaufen
• Period: 12 months (07/19-07/20)
• Portal: Google Trends

Insider: Desperate search? Interest as an indicator

But even more interesting is a look at the “long tail” of search queries.

As previously described, another indicator of the increased interest in selling real estate is that people are not only looking at the search results on the first page but are looking for even more detailed, additional information. This can be seen because more people click on page 2, 3 and 4 on Google, as can be seen here in the analysis:

Selling a house: Analysis real estate portal

Source (screenshot): Google Search Console

Insolvency

1. Hamburg
2. Bremen
3. North Rhine-Westphalia
4. Schleswig-Holstein
5. Baden-Württemberg

Insolvency: analysis and infographic

• Search Keyword: Insolvency
• Period: 12 months (07/19-07/20)
• Portal: Google Trends

Statistics: Number of insolvencies

Total number of insolvency proceedings in Germany from April 2019 to April 2020:

You can find more statistics at Statista

Real Estate Share

1. Rhineland-Palatinate
2. Bavaria
3. Hesse
4. Baden-Württemberg
5. Berlin

Real estate share: analysis and infographic

• Search Keyword: Immobilienaktie
• Period: 12 months (07/19-07/20)
• Portal: Google Trends

Real Estate News Online

Here you will find a great overview of our topics and other renowned online portals and newspapers for real estate news.

List from Real Estate News Online:

• Handelsblatt
• Real estate investor Alex Fischer
• Manager Magazine
• FIV Magazine / Real Estate
• Frankfurter Allgemeine
• Star
• Focus Online
• IM Real Estate Manager
• Haufe
• T-Online
• South German Newspaper
• Federal Gazette
• Berlin.de
• Real Estate Newspaper
• Mirror

New! Real estate Corona crisis: demand increases

These days, many are talking about the second wave that is now coming to Germany but also to the whole world. Already at the beginning, with the Corona pandemic, many economic but also financial news warned that in autumn a wave of insolvencies will come upon us. A logical consequence of insolvency is the loss of property, not only in the form of jewelry, cars or furnishings, of course real estate will also be affected if the rate of insolvencies in Germany increases. Single-family homes but also apartment buildings, with several tenants.

• Real estate Corona crisis: demand increases

News Special: News from Germany

Analyses and special articles by Stephan M. Czaja (Lukinski):

Sell house fast: Corona and the risk of insolvency

Investment Istanbul: Investing in Turkey?

Vonovia & Deutsche Wohnen in the DAX

Buy and rent in Berlin

Germany: Price Atlas Big City

Buying luxury real estate: Facts and prices

This is how Jeff Bezoz lives: richest man in the world

Corona: Is the real estate bubble bursting?

Coronavirus: meaning and onset

Investment: Real Estate, Shares & Co.

Real Estate Interviews

Current real estate interviews in the news:

Real estate as an investment: What to look out for?

Investing in real estate: Classic or exotic?

Is building saving worthwhile?

Investor Interviews: Videos

Mortgage Bank at a glance

• Hypothekenbank – obsolete name for Pfandbriefbank
• Pfandbrief – secured and interest-bearing promissory note
• Business: purchase, aggregation and sale of mortgages and granting of loans
• Many German banks offer services in the area

Back to the wiki: Real Estate

Prevent foreclosures – The options

As soon as one has been informed about a foreclosure, the worries and fears are great. From many quarters in this situation comes the phrase, “You can’t stop a foreclosure.” But how hopeless is this situation really? What options are there to fight the foreclosure proceedings? We have listed 4 options for you that may be able to help you.

The way out of the foreclosure – negotiations with the bank

Keep calm and consider what course of action would be best for you. The best way to escape foreclosure is to negotiate with your bank. Not only does your current financial situation play an important role, but the forecast of your future financial situation also plays an important role. A bank will only be interested in agreeing to a new deal if there is a good chance that the installments will be paid on time in the future. It is particularly important that you act in good time when you learn of the enforcement proceedings.

Deferment of installments

This option is recommended exclusively for people who can say with certainty that they will have more money available again in the future. The core of this option is the deferral of the installments. A deferment means the suspension of one or even several loan installments. The bank will agree to this option only if there is an improvement in the financial situation in the future.

Reduce or suspend the repayment rate

One way to prevent the foreclosure of your home is to reduce or even suspend the repayment to be paid. To make this option a reality, you should talk to your bank. The likelihood that they will agree to a new arrangement with you is not that small, as the bank often does not benefit from a foreclosure either. This procedure is particularly useful if it is foreseeable that you will have more money available again in the future.

Reschedule

Another possible option in the event of an impending foreclosure is to reschedule. Rescheduling means taking out a new loan to pay off an old loan. Rescheduling only makes sense if you have to pay less interest on the new loan than you did on the old one. It is important to constantly try to reduce your interest costs. You can take out a new loan with the same bank or with any other bank.

If you have actually managed to do this and have reached a new agreement with your bank, it makes sense that you still try to cut back a little in your everyday life and save money so that you can fall back on your savings in financial bottlenecks. You can save in a wide variety of areas of your life. From getting rid of your own car and switching to public transportation to comparing and switching electricity providers. Here we have an article for you that deals with the topic of “saving”:

Read also:

• Foreclosure explained
• Online portal and local court list
• Foreclosure Submission
• Receivership
• Compulsory mortgage
• Tip! This is how an auction works (external): Compulsory auction procedure

Saving: Advisor and Financial Check

First of all, it is important to have a stable basis. You must always keep an eye on regular and one-off expenses. Our guidebook provides valuable tips and tricks for creating a solid financial basis step by step.

• Saving advisor: Financial Check
• Saving in everyday life (14 tips for investing)

We also have many individual areas where a lot of money can easily be saved. Every week, every month, so that a solid financial basis is getting closer and closer:

• Save subscriptions
• Save Shopping
• Save Driving
• Save free time
• Saving budget
• Save Travel
• Save electricity
• Save relocation

Investing: Investments

With stable financial resources, it is then particularly worthwhile to think about your first investments, so that your money – passively – works for you.