When it comes to
Bankruptcy Bundaberg, generally
people aren't aware that there may be both voluntary, and involuntary
bankruptcy - both have different methods and rules.
Involuntary bankruptcy
arises when someone you owe money to applies to the court to declare you
bankrupt. Commonly when you get one of those notices, you have normally 21 days
to pay all the debt. If you don't, then the creditor returns 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 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. Other
than 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 overseen to in the exact same way.
However, when it
concerns Bankruptcy for this, the stress and anxiety, torment and fear that
accompanies this method is incredible. If you think you are prone to be made
bankrupt by someone, get some suggestions 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 too late.
Voluntary Bankruptcy
However, when it
comes to Bankruptcy, sometimes there are moments that it is the most effective
option. So you may need to ask yourself, 'when should I consider voluntary
Bankruptcy?'.
This question is
not the very same for everyone of course, but usually I find that one way you
could work it out is to figure out how long it will take you to pay each of
your debts - if its longer than 3 years (the period you are declared bankrupt),
then this may 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
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
company will default your credit file. That default will sit on your file for 5
years, so for $30 you can have your credit file seriously damaged for that
period of time - and all of this will affect how you need to approach Bankruptcy.
In many ways,
the ease with which companies/credit providers can default your credit file is
unjust. 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 rubbed out
completely.
So if your
credit rating is a big aspect 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 pay back the money and nevertheless have it on
your file for 7 years.
Bankruptcy
I have talked
about the word a few times now, but when it comes down to it, Bankruptcy is the
biggest part, and the part 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 arrangements are
very generous: you can go bankrupt owing millions of dollars and after 3 years
it's all over with no strings attached. As compared to countries like the
United States, our bankruptcy laws are very generous.
I don't pretend
to know why that is but a few 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 in turn costs the taxpayer anyway.
Bankruptcy wipes
all your debts including ATO debts except for a few things:
·
Centrelink Debts, Court Fines
like parking and speeding fines.
·
HECS or Fee Help loans.
·
Money to take care of 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, remember that there are always alternatives when it involves Bankruptcy
in Bundaberg, so do some homework, and Good luck!
If you want to
learn more about just what to do, where to turn and what questions to ask about
Bankruptcy, then don't hesitate to check with Bankruptcy Experts Bundaberg on
1300 795 575, or visit our website: bankruptcyexpertsBundaberg.com.au.