When it comes to
Bankruptcy Darwin, quite often
people aren't aware that there can be both voluntary, and involuntary
bankruptcy - both of these have different methods and policies.
Involuntary bankruptcy
takes place when someone you owe money to involves the court to declare you
bankrupt. Typically when you get one of these types of notices, you have 21
days to pay all the debt. If you don't, then the creditor goes back to the
court and requests the court to provide a sequestration order that declares you
bankrupt. A trustee is appointed, and then you have 14 days to get the
documentation in and then you are bankrupt.
You can contest
a bankruptcy notice by going to court following the 21 days have expired and
put your case forward, to prevent it going to the next level. Apart from the
way you became bankrupt there is in reality no distinction between Involuntary
Bankruptcy and or Voluntary Bankruptcy - once you are declared bankrupt,
they're conducted to in the very 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 more than likely to be made
bankrupt by someone, get some tips and act on that advice. Generally I've found
it's always more effective to know what you can and can't do before you have a
person bankrupt you. Once you are bankrupt, it's typically far too late.
Voluntary Bankruptcy
On the other
hand, when it comes to Bankruptcy, sometimes there are times that it is the
best option. So you may have to ask yourself, 'when should I consider voluntary
Bankruptcy?'.
This question is
not the very same for everyone of course, but commonly I find that one way you
could work it out is to figure out 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 assist you make that decision, and help you to understand Bankruptcy.
Once, I had an
80 year old pensioner, who came to me once regarding * Bankrupcty tell me that
her credit card statement calculated how long her debt would take to pay at the
level 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
service 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 need to approach Bankruptcy.
In many ways,
the ease with which companies/credit providers can default your credit file is
unethical. The punishment doesn't seem to amount to the crime in my book. So if
you actually have defaults on your credit report for 5 years, bear in mind that
bankruptcy is on your credit file for a total 7 years then its erased
completely.
So if your
credit rating is a big element in trying to decide whether to participate 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 contrast
is that with a DA or PIA you repay 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 element more 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 country the provisions are
very generous: you can go bankrupt owing millions of dollars and after 3 years
it's all finished with no strings attached. As compared to countries like the
United States, our bankruptcy laws are extremely good.
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 finds that 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
every one of 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 actually insured.
There is much
more that can be said about this and Bankruptcy in general but the objective of
this blog was to help you decide between a few possible options. When getting
some advice, don't forget that there are always alternatives when it involves Bankruptcy
in Darwin, so do some research, and Good luck!
If you want to
learn more about precisely what to do, where to turn and what questions to ask
about Bankruptcy, then feel free to talk to Fresh Start Solutions Darwin on
1300 818 575, or visit our website:freshstartsolutions.com.au/bankruptcy-Darwin
