When it comes to
Bankruptcy Bunbury, normally people
aren't aware that there may be both voluntary, and involuntary bankruptcy -
both have distinct methods and rules.
Involuntary
bankruptcy happens when a person you owe money to involves the court to declare
you bankrupt. Normally when you get one of these kinds of notices, you have
actually 21 days to pay all the debt. If you do not, then the creditor returns
to the court and asks the court to issue a sequestration order that declares
you bankrupt. A trustee is assigned, and then you have 14 days to get the
documents in and after that you are bankrupt.
You can
challenge a bankruptcy notice by going to court after 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 fact no difference between Involuntary
Bankruptcy and or Voluntary Bankruptcy - once you are simply declared bankrupt,
they're administered to in the very same way.
However, when it
comes to Bankruptcy for this, the stress, torment and fear that accompanies
this method is incredible. If you think you are more than likely to be made
bankrupt by someone, get some help 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
someone bankrupt you. Once you are bankrupt, it's normally too late.
Voluntary Bankruptcy
Alternatively,
when it comes to Bankruptcy, sometimes there are times that it is the best
option. So you may want to ask yourself, 'when should I consider voluntary
Bankruptcy?'.
This question is
not the very same for everybody of course, but basically I find that one way
you could work it out is to figure out just 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
rate she was paying off her account, and it was 35 years! Imagine 35 years for
one credit card bill.
Credit rating
damage can help you think this through. If you move house and fail to remember
to pay your $30 phone bill for 6 months more, it's very likely the telephone
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 seriously 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
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 rubbed out
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 variation
is that with a DA or PIA you repay the money and still have it on your file for
7 years.
Bankruptcy
I have stated
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 go
over 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 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. These
days I suppose the government assumes 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
every one of 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 insured.
There is much
more that can be said about this and Bankruptcy in general but the purpose of
this blog was to help you decide between a few possible options. When getting
some advice, don't forget that there are always options when it concerns Bankruptcy
in Bunbury, so do some research, and Good luck!
If you wish to
find out more about just what to do, where to turn and what questions to ask
about Bankruptcy, then don't hesitate to consult with Bankruptcy Experts
Bunbury on 1300 795 575, or visit our website:bankruptcyexpertsBunbury.com.au.