Rehabilitation

Rehabilitation shall refer to the restoration of the debtor to a condition of successful operation and solvency if it is shown its continuance of operation is economically feasible. Its creditors can recover by way of the present value of payments projected in the plan, more if the debtor continues as a going concern than if it is immediately liquidated [The LawPhil Project].
Financial rehabilitation is needed when an individual is insolvent, and his estate is subsequently sequestrated. Financial rehabilitation is, therefore, the process (whether it is automatic or made by order of the court) to rid the individual of his insolvent status.
Insolvency occurs on two levels. Factual insolvency occurs when your liabilities are more significant than your assets. Commercial insolvency occurs when your cash flow is insufficient to pay your debts as they become due and payable. The difference between these two forms of insolvency is that with the latter, your assets may still exceed your liabilities [DuToit’s Attorneys&Mediators].

Sources:

An act providing for the rehabilitation or liquidation of financially distressed enterprises and individuals. The LawPhil Project. Retrieved from: https://lawphil.net/statutes/repacts/ra2010/ra_10142_2010.html

Financial Rehabilitation: What is it and when is it used? DuToit’s Attorneys&Mediators. Retrieved from: https://www.dutoitsattorney.co.za/blog/financial-rehabilitation-what-it-and-when-it-used#_ednref1