When it comes to Filing for Bankruptcy in Port Macquarie, there are a load of choices that we get given depending on who we are, who we talk with, and exactly what has gone wrong. The most common trouble I see with Filing for 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 Filing for Bankruptcy in Port Macquarie, a lot of the facts you receive on this subject will reflect the interests of the advice giver. That is why, if you call a debt consolidation company, I can guarantee you they will tell you to consolidate your debts. The debt consolidation business is a multi-billion dollar industry making money in one very simple way: charging you a fee for assisting you wrap each of your credit card and personal loans into one neat and tidy package.
I hate to tell you this but they won’t be doing it for free. Please do not misunderstand me: if you feel your financial troubles in Port Macquarie may possibly be solved by paying less interest, then go ahead and look into the possibilities. Even a small amount of interest saved over years quickly adds up.
Normally I find if you read this blog you’ve most likely attempted to consolidate your debts already and come to the following realisations similar to these:
- Your credit rating is not good, and your credit file already has defaults on it so not a single person will give you a loan, consolidated or otherwise,.
- By the time you work it all out, you’re so far down a hole that saving a bit of interest simply won’t make a great deal of difference,.
- You’ve probably arrived at the point where you’ve had enough, you’re mentally burnt out, you can’t go on yet another day ignoring blocked calls on your phone, ignoring the demands in the mail and so forth.
Personal Insolvency Agreements.
So when it concerns Filing for Bankruptcy in Port Macquarie, what’s the huge difference between a Debt Agreement and a Personal Insolvency Agreement?
Overall flexibility 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 agency that advertises on TV. Essentially this process resembles Debt Agreements (DA): The trustee has a meeting with the people you owe money to and these guys arrange a deal on your behalf. You can offer a lump sum settlement figure or take part in a payment plan, or perhaps you can offer them assets instead of cash. This may sound acceptable when it comes to the troubles with Filing for Bankruptcy– that is up until you discover that one of the obstacles with PIA’s is that 75 % of the people you owe money to will need to come to an understanding the deal. If they do not, your plan is denied or ought to be renegotiated.
Generally the people you owe money want all their money back as well as interest. Sometimes they’ll opt for beneath the amount you owe them – it’s typically a percentage of the debt– but let me 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 in fact settle for.
In many cases you’ll have to pay back 100 % of the debt owed. This is not just because your creditors are greedy or have a mean streak, it’s because the administrators take 20 % of whatever is agreed 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 Filing for Bankruptcy and insolvency I’ve heard of creditors settling for 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 Port Macquarie aren’t going to get that lucky!
If you want to find out more about what to do, where to turn and what questions to ask about Filing for Bankruptcy, then feel free to contact Bankruptcy Experts Port Macquarie on 1300 795 575, or visit our website: www.bankruptcyexpertsPortmacquarie.com.au.