When it comes
down to Bankruptcy Rockhampton,
there are a bunch of options that we get given depending upon who we are, who
we talk to, and just what has gone wrong. Among the most common trouble I see
with Bankruptcy is when it comes to choosing between Debt Consolidation,
Personal Insolvency Agreements, and Bankruptcy itself.
Should I consolidate my debts?
When it comes to
Bankruptcy in Rockhampton, a lot of the help and advice you receive on this
topic will reflect the interests of the advice giver. Therefore, if you call a
debt consolidation provider, I can assure you they will tell you to consolidate
your debts. The debt consolidation industry is a multi-billion dollar industry
making money in one very simple way: charging you a fee for aiding you wrap
every one of your credit card and personal loans into a single neat and tidy
package.
I hate to tell
you this but these guys won't be doing it for free. Please don't misunderstand
me: if you think your financial problems in Rockhampton could be solved by
paying less interest, then go ahead and look into the choices. Even a little
amount of interest saved over years rapidly adds up.
Normally I find
if you are reading this blog you've probably tried to consolidate your debts
already and come to the following realisations like these:
- Your credit rating is no good, and your credit file definitely has defaults on it so nobody will give you a loan, consolidated or otherwise,.
- By the time you work all of it out, you're so far down a hole that saving a small amount of interest just won't make a lot of difference,.
- You've likely arrived at the point where you've had enough, you're mentally drained, you can't go on yet another day ignoring blocked calls on your phone, ignoring the demands in the mail and so on.
Personal Insolvency Agreements
So when it comes
to Bankruptcy in Rockhampton, what's the huge difference between a Debt
Agreement and a Personal Insolvency Agreement?
Adaptability is
the main point Personal Insolvency Agreements (PIA) have in their favour.
They're also administered by a registered and - may I add - regulated trustee
featuring the government trustee ITSA, and not a private company that
advertises on TV. Basically this process is similar to Debt Agreements (DA):
The trustee has a meeting with the people you owe money to and these guys
arrange a deal in your place. You can give a lump sum settlement figure or take
part in a payment plan, or you can offer them assets rather than cash. This
might sound fine when it comes to the problems with Bankruptcy - that is up
until you realise that one of the difficulties with PIA's is that 75 % of the
people you owe money to must agree on the deal. If they do not, your proposal
is rejected or will have to be renegotiated.
Generally people
you owe money want all their money back and also interest. Sometimes they'll
opt for beneath the amount you owe them - it's typically a percentage of the
debt - but allow me to stress this part: because of all the variables involved
in the negotiation process to put together a PIA its difficult to put a figure
on what the people you owe money to will actually settle for.
In most cases
you'll have to pay back 100 % of the debt owed. This is not because your
creditors are greedy or have a mean streak, it's because the administrators
take 20 % of whatever is decideded upon with the people you owe money to. That
applies whether you use a private company for this process or ITSA, the
government body setup to administer to these PIAs.
When it comes to
Bankruptcy and insolvency I've come across creditors choosing less 80 % on rare
occasions, but that usually only occurs with a public company entering into
receivership owing huge sums of money (the kind that makes the news). If you
are were owed $10million and you know the people who owe you the money have a team
of clever lawyers and some very clever frameworks in place and they offer 5 %
of the debt, you might take it and be grateful. Sadly, ordinary punters like
you and me in Rockhampton aren't going to get that lucky!
If you would
like to learn more about what to do, where to turn and what questions to ask
about Bankruptcy, then feel free to contact Bankruptcy Experts Rockhampton on
1300 795 575, or visit our website:bankruptcyexpertsRockhampton.com.au.
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