When it comes to
Bankruptcy Sunshine Coast, often
people aren't aware that there can be both voluntary, and involuntary
bankruptcy - each have unique approaches and guidelines.
Involuntary
bankruptcy occurs when someone you owe money to applies to the court to declare
you bankrupt. Typically when you get one of these kinds of notices, you have
actually 21 days to pay all the debt. If you don't, then the creditor returns
to the court and asks the court to provide a sequestration order that declares
you bankrupt. A trustee is selected, and then you have 14 days to get the
documents in and afterwards you are bankrupt.
You can
challenge a bankruptcy notice by going to court right after the 21 days have
expired and put your case forward, to avoid it going to the next level. Apart
from the way you became bankrupt there is in fact no distinction between
Involuntary Bankruptcy and or Voluntary Bankruptcy - once you are simply
declared bankrupt, they're conducted to in the exact same way.
However, when it
concerns Bankruptcy for this, the stress, torment and fear that accompanies
this process is incredible. If you think you are prone to be made bankrupt by
someone, get some assistance and act on that advice. Generally I've found it's
always far better to know what you can and can't do before you have a person
bankrupt you. Once you are bankrupt, it's generally too late.
Voluntary Bankruptcy
Alternatively,
when it comes to Bankruptcy, sometimes there are moments that it is the best
option. So you may want to ask yourself, 'when should I consider voluntary
Bankruptcy?'.
This question is
not the same for each person of course, but normally I find that one way you
could work it out is to figure out just how long it will take you to pay all of
your debts - if its longer than 3 years (the period you are declared bankrupt),
then this may serve to help you make that decision, and help you to understand Bankruptcy.
Once, I had an
80 year old pensioner, who spoke to me once regarding * Bankrupcty tell me that
her credit card statement calculated how long her debt would take to pay at the
rate she was paying off her account, and it was 35 years! Imagine 35 years for
one credit card bill.
Credit rating
damage can really help you think this through. If you move house and overlook
to pay your $30 phone bill for 6 months more, it's very likely the phone
company will default your credit file. That default will remain on your file
for 5 years, so for $30 you can have your credit file truly damaged for that
period of time - and all of this will impact how you have to approach Bankruptcy.
In many ways,
the ease with which companies/credit providers can default your credit file is
not fair. The punishment doesn't seem to equate to the crime in my book. So if
you currently have defaults on your credit report for 5 years, remember that
bankruptcy is on your credit file for a total 7 years then its rubbed out
completely.
So if your
credit rating is a big factor in trying to decide whether to take part in a
Debt Agreement or Personal Insolvency Agreement or Bankruptcy remember they
will all sit on your credit file for a total of 7 years. The biggest difference
is that with a DA or PIA you pay back the money and nevertheless have it on
your file for 7 years.
Bankruptcy
I have mentioned
the word a few times now, but when it comes down to it, Bankruptcy is the
biggest part, and the part most people are afraid of when they come to me to
talk about their financial situation and Bankruptcy. The other side of crime
and punishment equation is bankruptcy, and in this specific country the
arrangements are very generous: you can go bankrupt owing millions of dollars
and after 3 years it's all over with no strings attached. Compared to countries
like the United States, our bankruptcy laws are really reasonable.
I don't pretend
to know why that is but a couple of hundred years ago debtors went to prison.
Nowadays I suppose the government feels the sooner it can get you back on your
feet working and paying tax, the better. It makes more sense than locking you
up which costs the taxpayer anyway.
Bankruptcy wipes
all your debts including ATO debts with the exception of a few things:.
·
Centrelink Debts, Court Fines
like parking and speeding fines.
·
HECS or Fee Help loans.
·
Money to pay for a car accident
if the car was not insured.
There is far
more that can be said about doing this and Bankruptcy in general but the
purpose of this blog was to help you decide between a few available options.
When getting some advice, bear in mind that there are always alternatives when
it involves Bankruptcy in Sunshine Coast, so do some investigation, and Good
luck!
If you want to
find out more about precisely what to do, where to turn and what questions to
ask about Bankruptcy, then don't hesitate to contact Bankruptcy Advice Sunshine
Coast on 1300 879 867, or visit our website:bankruptcy-advice.com.au/Sunshine
Coast .
