The conclusion of a debt agreement is a serious step in taking steps to pay down uncontrollable debts. There are consequences that can affect your obligations, businesses, credit documents and other problems depending on your circumstances. For more information, visit the AFSA website. A debt contract is a formal alternative to bankruptcy, where all your creditors agree to accept the partial payment of the debt equally. It is manufactured under Part IX of the Bankruptcy Act. You don`t have to be able to pay your debts for this type of agreement. If you are struggling with debt, a debt contract may be the right solution for you. Safe Debt Management aims to improve your life and can help you get out of debt. We work on your budget and present you with options at your disposal.
Beyond Debt can help if you have a debt of more than $8,000 and you meet the legal criteria: no, although debt contracts are managed in accordance with bankruptcy law, they are an alternative to bankruptcy. However, by submitting a proposal, you are committing “an act of bankruptcy.” If you sign up for your debt contract that will be repaid, you will be free of most of your unsecured debts, which is a toxic debt. Compare how this works if you continue to make payments on your credit cards. Like many people, you can only pay the minimum monthly refund on your credit cards. This way, you will find that it takes years to pay off your debts. Take a look at the moneysmart site (moneysmart.gov.au). It shows how $1,000 on your credit card can be converted into an 11-year loan because the amount you need flows slowly and you pay a large amount of interest. Financial advisors can also help you understand the impact of bankruptcy and debt contracts. Before you compete or consider a debt contract, you should explore your other options for managing uncontrollable debt.
Most debt contracts are between 3 and 5 years, so you know exactly when you will be debt-free. 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. Suppose you have an unsecured debt totalling $35,000 and you can afford to offer $125 per week to your creditors for 260 weeks, or $32,500. If the creditors accept your proposals, they also appoint us with the management of your debt contract and accept that we can keep part of the repayment for the contract management work.