If you are unable to meet your debts, you may want to consider bankruptcy or an alternative to bankruptcy called the “debt agreement.” These are formal legal options that are available under the Bankruptcy Act 1966. The registered agent also helps you develop a debt contract proposal based on what you can pay creditors and helps you fill out the correct forms. Once a debt contract has been accepted by your creditors, it becomes a legally binding agreement. You must start with the repayment, which is stipulated in the agreement from which your creditors receive dividends. While the agreement is in effect, the interest on your unsecured debt will be frozen and no enforcement action can be taken against you or your property. Once the terms of your debt contract have been signed, you will be free of any unsecured debt included in the agreement. Unfortunately, there are no quick fixes to managing uncontrollable debt. Filing for bankruptcy involves many requirements and restrictions, such as the sale of assets by an agent, monitoring your income, losing certain commercial licenses and abandoning your passport, your credit score is a great success (to name a few). Through a debt contract, you are in principle asking your creditors for a fair path by offering them your best offer. In this way, you can keep assets with shared equity up to the value of the asset limit (more information – contact Safe Debt Management). You will not have your income monitored and you will not have to hand over your passport. Debt contracts are managed in accordance with Part 9 of the Bankruptcy Act, but are not considered competitive. If you submit a proposal, you are committing what is called a “bankruptcy deed.” The Australian Financial Security Authority (AFSA) is not obliged to accept your debt contract.
There are qualification requirements and AFSA will evaluate your individual proposal to determine if it meets these requirements. Why would you continue to file your debt contract instead of another debt alternative? There are a number of benefits related to a debt deal that you will not get with other types of debt solutions. Here are the most common benefits: the details of each debt agreement depend on the circumstances of the applicant and the willingness of lenders to recover their money in the proposed manner. The agreement may require you to complete one of the following steps: If your creditors accept your proposal and you enter into a debt contract, it will be mentioned in your credit report for five years and will be considered a bankruptcy. As a general rule, you must pay a pre-payment fee to a debt agreement administrator to complete the agreement, plus a monthly administration fee for the lifetime. What happens if you withdraw the proposal or afSA cancels the proposal? A debt contract application is a bankruptcy, which means that your creditors can let them go bankrupt if they do not accept the proposal. A debt contract is mentioned in your credit report. No, not all creditors need to agree.