What is a Personal Insolvency Agreement?

This is adaptable agreement between you and your lenders. It is managed through a trustee who administers to just how much you have to pay and when etc. Once those conditions have been met you are then free to begin again with a clean slate.

What is a Debt Agreement?

A debt agreement enables a debtor to enter into an arrangement with their creditors to satisfy their debts without being made bankrupt.

You cant enter into a Debt Agreement if you have been bankrupt, or you are currently already in a debt agreement. There are also income restrictions, property value and unsecured debt value restrictions, If you wish to know more please get in touch with us on 1300 818 575.

Why do some business say Debt Agreements or Personal Insolvency Agreements

The reason you find plenty of expensive commercials on the TV in the Bendigo area inviting you to go for one of these alternatives is that there is lots of cash in it for the companies that administer them. You will notice, if you havent already, that every company has the tendency to give (biased) advice

according to the product that they offer. For instance, Debt Agreement Companies ridicule bankruptcy companies and so it goes with much of the financial services industry.

Should I consider a Debt Consolidation Loan?

There are the very occasional conditions where a debt consolidation loan is the best idea. Usually the issue with them is all it is really doing is bundling 5-15 various debts into one large debt. If you are battling to pay all your various loans now why do you think it will be magically easier to have one enormous bill. Just to make it all worse you typically have to pay up front for the pleasure of this choice. If you wish to get some clarification on this simply contact us on 1300 818 575 or go and download The Big 5 e-Book.

Will the bank let me keep my house even if I’m a bankrupt?

Why would the bank want bankrupt customers? Wouldnt they want to sell your house and not take the chance? Keep in mind – the bank that has kindly lent you the money for your house is making good money every month in interest from you, month in and month out. As long as you keep up to date with your payments then the bank wants you in there at all costs. However its not the banks call if a trustee decides that there is enough equity in your house the trustee will compel you and the bank to sell your home.

How is equity determined?

This is the most important part of this process. Why? Put simply, if you get it wrong you will lose your house. There are a few things you need to know here. Firstly, your gut instinct or assumption about the true value of the property is probably generous. Most people think their house is worth more than it really is.

When you file for bankruptcy the trustee may ask how you established your price for the home. In some cases they will ask for more detail about your valuation, maybe a rates notice or a real estate agency’s valuation or a registered valuation. A simple strategy would be to look on www.realestate.com.au then click on the Sold tab on that website and search for recent house sales in your street or neighborhood. This will help you get some idea of the reality of the market right now. Remember, the valuation is based on a quick sale not a slick real estate agents marketing campaign. Understanding this step is critical, so get some advice before going ahead, call us on 1300 818 575.

What if My House has too much Equity what can I do?

If your house has plenty of equity and you are still drowning in debt, there are still some options available to you. In fact, this applies to vehicles or other assets you may have as well. What you cannot afford to do is assume that everything will be ok. It is the bankruptcy trustees job to sell whatever assets you have when you file for bankruptcy and put that money towards your debts. Getting this wrong will be disastrous! Before you take your next step get some advice. We offer a free, initial consultation; just call us today on 1300 818 575.

Who will know about my bankruptcy?

There are four groups of people that will learn that you are bankrupt.

1. Individuals that you tell
2. Your creditors or people you owe money to
3. Individuals that see your credit file while youre bankrupt. The only way this will happen is if you sign a privacy form for them to access your credit history. You only ever do this when you apply for a loan.
4. You will be listed on the National Insolvency Index on the internet somewhere. Its hard to find and people need to pay to see if someone is bankrupt on it.

At Bankruptcy Experts Bendigo, we are completely conscious that there is still a stigma attached to bankruptcy. We understand this concern and we can help to ensure that if you declare yourself bankrupt that you dont need to go to court, get your name in the newspapers or be publicly made out to be a criminal or some kind of failure. We can help ensure that bankruptcy is quick and easy. In fact, the whole process will only take a few days. It makes it possible for the average person to get out of debt and on with their lives. For
more detailed information about bankruptcy and your job, download The Big 5 e-book.

Bankruptcy and Income

Changes are coming to the world of bankruptcy. If you need to know what is happening then pay attention now. Since March 2016 there have been changes to the Income Threshold amounts. This signifies that there are changes to just how much money you can keep when bankrupt. This is your net income after tax and child support (if applicable) are deducted. If youre in business when bankrupt then, of course, its also net (after tax) of business spending, which is commonly calculated annually.

Your net income may be regulated to take into account things like salary sacrifice and substantial superannuation payments etc. Your net income might also allow for more unusual costs incurred as a result of being employed. For example, if you are subjected to an unusually high amount of travel expenses to get to and from your job this can sometimes also be take into consideration.

Your bankruptcy trustee has to ascertain your real net income, according to the bankruptcy rules. The income threshold numbers are also per person and are set by the Government every March and September to allow for the movement in the cost of living.

Who is considered a dependent?

This can be any person, of any age, that lives with you and earns less than $3,343 per year. If, in the case you have a child or children that you pay child support for and they dont live with you full-time, then you cannot claim these children as dependents.

Will I lose my small business if I go bankrupt?

The simple answer is – you dont have to but you do need to get the right guidance. Company insolvency laws are very involved and you need to tread carefully if you wish to continue to be self-employed.

You may already recognise that you can no longer be the director of a Pty Ltd Company if you are bankrupt. Even so, that doesnt inevitably mean you cant run your very own business and employ staff etc.

Should I put my company into liquidation?

Among the main reasons you may wish to consider liquidation as opposed to bankruptcy is because if you liquidate your company, it doesnt inevitably mean you have to go bankrupt. In Australia, businesses that become insolvent have a few options, such as liquidation, voluntary administration and so forth. If you need to know more call us on 1300 818 575.

Isn’t it illegal to run a similar business after bankruptcy?

It could be. There are considerations when and if you declare bankruptcy as a business owner. You cannot run up heaps of debt in your business, then go bankrupt and then open the doors the next day like nothing has happened. There are laws in place to prevent that is called Phoenix companies rising up out of the ashes of an old company. Dont get overly stressed about what you can and cant do as a company owner; just get the correct advice by calling Bankruptcy Experts Bendigo today on 1300 818 575.

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