If you reside in the Port Macquarie area and you are having problem with your Personal or Business Debts?
Then give Bankruptcy Experts Port Macquarie a call. If your debts are out of control, then maybe the idea of bankruptcy has gone through your mind, and now you have finally taken the next and most challenging step discovering whether or not bankruptcy is best for you. Just the thought of it is devastating enough having it become a reality. We understand that there is an overwhelming sense of failure in this particular process. Maybe you are feeling stuck and like you have no options.
You Can Be 100 % Debt Free!
Can you imagine a future devoid of creditors calling and enjoying the mail again. There are a handful of things you must know before you make that very hard decision. First of all, the sooner you act the more alternatives you will have.
5 Questions you must settle in your mind before you go bankrupt.
Secondly, there are 5 significant questions you must have an answer to before you declare bankruptcy, if you wish to know what they are don’t hesitate to download the free-Book on the right hand side of this web page it will explore these questions at length and give you peace of mind that you are doing the right thing.
Is filing for bankruptcy my only option?
No! There are several choices available to you. Below is a table outlining the advantages and disadvantages of various debt solutions, this chart is by no means comprehensive but it will allow you to make a well informed decision.
What is a Personal Insolvency Agreement?
This is flexible agreement between you and your lenders. It is administered through a trustee who conducts to just how much you have to pay and when etc. Once those conditions have been met you are then free to start again with a fresh start.
Why you may wish to consider a Personal Insolvency Agreement
Pros – Personal Insolvency Agreements
- Avoid bankruptcy
- Possibly limit liability to make income contributions
- You repay 30 to 70 cents in the dollar to your creditors
- It can be a very a quick process.
- May have the ability to keep important assets.
- The debtors assets are independently managed
- Lower legal costs associated with court proceedings
Cons – Personal Insolvency Agreements
- You are not free until you have paid the entire debt
- It may take many years to settle the debt
- It still affects your credit report for 7 years the same as bankruptcy
- You can’t be a company director until the debt is worked out
- You are required to meet with your creditor face to face
- Your details will be published in a local newspaper.
What is a Debt Agreement?
A debt agreement makes it possible for a debtor to participate in an arrangement with their creditors to satisfy their debts without being made bankrupt.
Can I Enter into a Debt Agreement?
You can’t enter into a Debt Agreement if you have been bankrupt, or you are currently already in a debt agreement. There are also income restrictions, property value and unsecured debt value restrictions, If you need to know more please contact us on 1300 795 575
Pros – Debt Agreement
- Avoid Bankruptcy
- Stops creditors – can not take any further actions to recover their debts;.
- You may have the ability to keep essential assets.
Cons – Debt Agreement.
- There is an upfront expense to commence.
- You need to be approved. If you don’t make enough you will be declined.
- If you don’t make your repayments the agreement may be canceled and then the creditors can resume recovering of their debts;.
- The debtor details will appear on the National Personal Insolvency.
- Index (NPII) from the date that the debt agreement proposal was agreed to by ITSA.
- It still affects your credit rating for 7 years the same as bankruptcy.
- Nothing changes with secured creditors rights they may repossess if the debtor is in default.
Why do some companies say Debt Agreements or Personal Insolvency Agreements are the way to go?
The reason you find loads of expensive ads on the TV in the Port Macquarie region inviting you to sign up for one of these options is there is plenty of cash in it for the companies that administer to them. You will notice if you haven’t already that every business tends to give (biased) advice according to the product that they offer. For example Debt Agreement Companies ridicule bankruptcy companies and so it goes with much of the financial services industry.
Should I take into consideration a Debt Consolidation Loan?
There is the occasional instances where a debt consolidation loan is the best idea. Normally however the trouble with them is all it is really doing is bundling 5-15 various loans into one great big loan. If you are battling to pay all your different loans now why do you think it will be magically easier to have one enormous debt. Just to make it all even worse you typically have to pay up front for the pleasure of this option.
If you want to get some advice on this simply contact us on 1300 795 575 or go and download “The Big 5” e-Book.
BANKRUPTCY AND THE FAMILY HOME
If I file for bankruptcy can I keep my home?
Oftentimes the answer is yes. If this is a significant issue for you then the best way to get the solution is to call us here at Bankruptcy Experts Port Macquarie on 1300 795 575 and once we have comprehended your situation we can give you a crystal clear picture over the phone.
Virtually everyone is emotionally connected to their home, its where the children have grown, its where you enjoy life on a day to day basis. People typically think its an unavoidable consequence of bankruptcy and consequently they pressure themselves to the brink of madness to not lose the family home.
Will the bank permit me to keep my house even if I’m a bankrupt?
Why you might ask would the bank want bankrupt clients wouldn’t they want to sell your house and not take the risk? The bank that has kindly lent you the money for your house is making good money every month in interest from you, day in and day out, as long as you keep up to date with your payments then the bank wants you in there at all costs. Ultimately however it’s not the bank’s call if the trustee decides that there is lots of equity in your house the trustee will force you and the bank to sell your house.
What things determine if I will lose my home?
If you are up to date with your repayments then the biggest issue is equity. The trustee has a duty to gather as much money to help pay your bills once you go bankrupt. Equity is the ticket here. If you have $300,000 equity in your house and you have $100,000 worth of debt and no other way to pay the debt then the trustee sees your equity as a way to repay your debt, so the trustee will sell your house repay the debt and give you whatever is left over.
How is equity determined?
Typically a registered valuer from the Port Macquarie area is the most effective and safest way to figure out your current equity position, before you race out and get the local real estate agent to give you a micky mouse evaluation contact us for how to go about this process so that you can have assurance 1300 795 575. Or for a more substantial explanation about how your house will be considered do not hesitate to download “The Big 5” e-book.
What if my partners name is on the home loan?
Another notable factor to consider is ownership, in many cases houses are bought in joint names. Put simply a couple may have bought a house 50/50 using both earnings to make the repayments. If one party files for bankruptcy and the other party doesn’t, the equity is only factored on the 50 % of the property.
So in other words if you have a home in joint names and your total equity position is $100,000 then your actual equity is half of that $50,000.
It seems like I have very few choices when if comes to my house?
No not really there are many alternatives accessible to you when it comes to your house or any other asset when declaring bankruptcy. You need to get the right advice about this however, getting it wrong could be deadly. If you have questions feel free to contact us about your house on 1300 795 575.
BANKRUPTCY AND EMPLOYMENT
Will my employer be advised?
Who will know about my bankruptcy?
There are 4 groups of people that will know that you are bankrupt. 1. The people you tell. 2. Your creditors or people you owe money to. 3. Individuals that see your credit file while your bankrupt. The only way that will happen is if you sign a privacy form for them to access your credit report. You only ever do this we you apply for a loan. 4. You will be listed on the National Insolvency Index it on the internet somewhere, its hard to find and you have to pay to see if someone is bankrupt on it.
At Bankruptcy Experts Port Macquarie we are perfectly conscious that there is still a stigma about bankruptcy we recognize this concern in fact we can help make sure that if you declare yourself bankrupt you don’t need to go to court or get your name in the newspapers or be publicly made out to be a criminal. We can help ensure bankruptcy is simple and quick. In fact the whole process will only take a handful days. It makes it possible for ordinary people to get out of debt and on with their lives. For more detailed information about employment download “The Big 5” e-Book.
Will I lose my job if I go bankrupt?
The answer to the question is sometimes. The complication with some specialties isn’t that you can’t do the job any longer, it’s more an issue of professional bodies or associations that see bankruptcy in a dim light and can make things difficult for you.
What I could recommend is that you do your own homework here, do the research and investigate that process first before filing for bankruptcy because that may help you choose. Check if your profession is on the list below. If it is, I ‘d contact them personally and explain your situation. A few organizations won’t have a problem with your bankruptcy as long as it wasn’t accompanied by shady or doubtful behavior.
If you think you employment may be affected by your possible bankruptcy call us here at Bankruptcy Experts Port Macquarie on 1300 795 575.
BANKRUPTCY AND INCOME
Will my earnings be affected if I go bankrupt?
The answer to the question is possibly. The first thing you ought to know about going bankrupt is there is no constraint on just how much you can earn. However, I will mention that your income is a major factor when working through whether you have to go bankrupt.
The very first thing you have to know is just how much you can earn before you start repaying money to your creditors via your trustee (see table below).
Net income is the pre-tax / in the hand amount you earn each year. A dependant is someone who lives with you and earns less than $3,124 per year (regardless of their age).
You can apply for a hardship variation that raises the threshold amount, if you have expenses such as medical, child care, substantial travel to and from work, or a circumstance where your spouse used to work but is no longer able to add to the household income.
Child support is always considered in bankruptcy, if you receive child support that is not factored in as income. If you pay child support this will be also considered, for instance if you pay $5,000 child support every year and you have no dependants residing with you then your revised net income limit will be $55,332.10.
If you need more information about your income thresholds go ahead and download “The Big 5” E-book. there are some cases as a result of income that it is not an economically viable option to declare bankruptcy because you earn way too much in comparison to the debt you have.
What is your money worth in 2016?
Changes are coming to the world of bankruptcy, if you need to know what is happening, then listen here. As of March 2016 there has already been developments to the Income Threshold Amounts. This signifies that there are changes to what amount of money you can retain when bankrupt, this is actually your net income following tax and child support (if applicable) is deducted. If you’re in business while bankrupt, then of course it’s also after net (after tax) business expenditures, which is usually calculated on a yearly basis.
Your net income may be balanced to allow for things like salary sacrifice and high superannuation payments etc. Your net income can also allow for additional unusual costs incurred as a result of being employed, for instance if you incur an unusually high amount of travel costs to get to and from your job this can occasionally also be considered. Your bankruptcy trustee needs to find out your real net income according to the bankruptcy rules.
The income threshold totals are also per person, and are set by the Government every March and September to allow for the movements in the cost of living.
As of March 2016 the income thresholds are as follows;
With no dependents your net income can be $54,518.10 net per annum, i.e. that’s about $1,048.25 net per week take home pay. This is your cash. It’s all yours. It’s what you can always keep, and so anything over that amount is partition 50/50 with your bankruptcy trustee to be settled to your creditors.
With 1 dependent your net income can be $64,331.36 net per annum, i.e. approximately $1,237.14 net each week take home pay.
With 2 dependents your net income can be $69,237.99 net per annum, i.e. approximately $1,331.49 net every week take home pay.
With 3 dependents your net income can be $71,963.89 net per annum, i.e. about $1,383.92 net each week take home pay.
With 4 dependents your net income can be $73,054.25 net per annum, i.e. around $1,404.88 net weekly take home pay.
With more than 4 dependents your net income can be $74,144.62 net per annum, i.e. around $1,425.85 net per week take home pay.
If you think your case is more complicated, then feel free to get professional advice. If you have a particular income question just call us here at Bankruptcy Experts Port Macquarie on 1300 795 575 .
What can my partner earn if I go bankrupt?
There is no limit to what your other half can earn. Your spouse can earn a million dollars and they will not be required to contribute to your debts.
What if my spouse/partner and I both have to declare bankruptcy?
If a husband and wife each declare bankruptcy, and say that they’ve got no dependants, then they can each earn $939.23 net. An easy way to understand it is the same income rules apply for each individual in the home.
Who is considered a dependent?
When it come to bankruptcy a dependent is anyone you support who earns less that $3,197 annually.
BANKRUPTCY AND SELF EMPLOYMENT
Will I lose my small business if I go bankrupt?
The simple answer is you don’t have to but you do will need to get the right guidance. Corporate insolvency laws are very involved and you will need to tread carefully if you intend to continue to be self-employed.
You may already know that you can no longer be the director of a Pty Ltd Company if you are bankrupt, nevertheless that doesn’t inevitably mean you can’t run your very own business and employ staff etc.
What if my business has serious debts?
As a part of your bankruptcy we can help you wipe out your business debts so you can get a fresh start.
Should I put my company into liquidation?
Just one of the main reasons you may wish to consider liquidation rather than bankruptcy is because if you liquidate your company, it doesn’t automatically mean you need to declare bankruptcy. In Australia, businesses that become insolvent have a few alternatives, such as liquidation, voluntary administration and so forth. If you want to know more about liquidation and company re-structuring, go to the next page of this website, as there is a lot more about it there and or download “The Big 5” e-Book. Bear in mind, it’s the individuals who declare bankruptcy, not businesses.
This is a complicated area, so get some expert advice on this if you have a company. Typically speaking, the debts in a business and personal debts go together when a business owner declares bankruptcy.
What impact will bankruptcy have on my business?
A restriction that applies when you are bankrupt as a business owner is that you can be in your own business as a sole trader only. For some business owners, bankruptcy has an effect on their ability to run the business because of the licensing issues discussed in chapter two. For instance, if you run a building company, your license will be suspend once you’re bankrupt and consequently you can no longer trade without that license.
Isn’t it illegal to run a similar business after bankruptcy?
It can be. There are things to consider when and if you go bankrupt as a business owner: you can not run up heaps of debt in your business, then declare bankruptcy and then open the doors the next day like nothing has happened. There are laws in place to prevent what is called “phoenix companies” popping up out of the ashes of an old company.
Don’t get overly worried about what you can and can’t do as a business owner; just get the right advice and call Bankruptcy Experts Port Macquarie now 1300 795 575.