When it comes to
Bankruptcy Rockhampton, often people
aren't aware that there may be both voluntary, and involuntary bankruptcy -
each have different approaches and guidelines.
Involuntary bankruptcy
arises when a person you owe money to involves the court to declare you
bankrupt. Usually when you get one of these kinds of notices, you have actually
21 days to pay all the debt. If you don't, then the creditor goes back to the
court and asks the court to provide 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 immediately 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 reality no difference
between Involuntary Bankruptcy and or Voluntary Bankruptcy - once you are
simply declared bankrupt, they're managed 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 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 usually too late.
Voluntary Bankruptcy
Nevertheless,
when it comes to Bankruptcy, sometimes there are moments that it is the most
ideal option. So you may have to ask yourself, 'when should I consider
voluntary Bankruptcy?'.
This question is
not the same for everybody of course, but ordinarily I find that one way you
could work it out is to figure out just how long it will take you to pay each
one of your debts - if its longer than 3 years (the period you are declared
bankrupt), then this may really 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 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 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 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 affect how you have to approach Bankruptcy.
In many ways,
the ease with which companies/credit providers can default your credit file is
vicious. The punishment doesn't seem to match the crime in my book. So if you
actually have defaults on your credit report for 5 years, remember 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 issue in trying to decide whether to enter into 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 talked
about 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
go over 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. Compared to countries like the United
States, our bankruptcy laws are very reasonable.
I don't claim 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 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 a lot
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 readily available options. When
getting some advice, remember that there are always possibilities when it
relates to Bankruptcy in Rockhampton, so do some legwork, and Good luck!
If you would
like to learn more about precisely what to do, where to turn and what questions
to ask about Bankruptcy, then feel free to check with Bankruptcy Experts
Rockhampton on 1300 795 575, or visit our website: bankruptcyexpertsRockhampton.com.au.