Agreement Debts

Collection companies stop contacting you. But it can severely hurt your chances of borrowing money in the future. If you are unable to pay your debts, you may want to consider bankruptcy or an alternative to bankruptcy called a “debt agreement.” These will be formal legal options available under the Bankruptcy Act 1966. A debt agreement is an agreement you can make with your creditors if you can no longer afford to repay the debt. Only people who have been in debt for some time can make a debt deal. A debt agreement is actually an agreement with your creditors to pay an agreed amount over a certain period of time (usually between 3 and 5 years). In most cases, you can pay your debts for less than what is due and the balance is legally amortized. A debt agreement is for people with lower incomes who can`t pay what they owe. But there are consequences. A debt agreement is a debtor`s proposal to its creditors to repay its debts at a rate it can afford in its circumstances. A debt agreement, once accepted by creditors, is a legally binding agreement between a debtor and its creditors.

Debt agreements are a flexible alternative to bankruptcy. Although entering into a debt agreement is an act of bankruptcy, the debtor is not recorded as a debtor. However, most bankruptcy restrictions do not apply to persons entering into a debt agreement. The first thing you need to do is describe any type of debt and give it a name. You will refer to this debt by name in the rest of this section. Start by designating all your common debts first. Each of you will then list all your individual debts. Our current administrative fee is 22.73% plus GST. We are not taking over other expenditure from the debt agreement because we believe that this is an operating cost. This fee covers all aspects of managing your debt contract from start to finish.

Individual debts are those for which only one person has contracted the debt. For example, you may have credit cards in your name or individual lines of credit. One of you may have taken out a car loan. .