If you live in the Wyong area and you are having problem with your Personal or Business Debts?
Then give Bankruptcy Experts Wyong a call. If your debts really out of control, then perhaps the idea of bankruptcy has gone through your mind, and now you have finally taken the next and most difficult step figuring out whether or not bankruptcy is right for you. Just the prospect of it is hard enough without having it become a reality. We understand that there is a tremendous sense of failure in this particular process. Maybe you are feeling immobilised and like you have no options.
You Can Be 100 % Debt Free!
Can you think of a future devoid of creditors harrassing phone calls and looking forward to the mail again. There are a couple of things you should know before you make that very tough decision. Firstly, the sooner you act the more options you will have.
5 Questions you must settle in your mind before you declare yourself bankrupt.
Second of all, there are 5 crucial questions you must have an answer to before you file for bankruptcy, if you need to know what they are feel free to download the free e-book on the right hand side of this page it will address these questions specifically and give you peace of mind that you are doing the right thing.
Is Going bankrupt my only choice?
No! There are several choices available to you. Below is a graph describing the advantages and disadvantages of various debt solutions, this chart is by no means comprehensive but it will enable you to make an educated decision.
What is a Personal Insolvency Agreement?
This is adaptable agreement between you and your lenders. It is handled through a trustee who administers 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 new beginning.
Why you may prefer 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 get to keep important assets.
- The debtors assets are independently controlled
- 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 impacts your credit score for 7 years the same as bankruptcy
- You can not be a company director until the debt is worked out
- You are required to meet in person 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 enter into 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 wish to know more please get in touch with us on 1300 795 575
Pros – Debt Agreement
- Avoid Bankruptcy
- Stops creditors – can not take any further actions to recover their debts;.
- You may get to keep important assets.
Cons – Debt Agreement.
- There is an upfront charge to start off.
- 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 terminated and then the creditors can resume collection of their debts;.
- The debtor details will appear on the National Personal Insolvency.
- Index (NPII) from the date that the debt agreement proposal was approved by ITSA.
- It also 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 firms say Debt Agreements or Personal Insolvency Agreements are the way to eliminate my debts?
The reason you find plenty of expensive commercials on the TV in the Wyong region inviting you to sign up for one of these options is there is lots of money in it for the companies that manage to them. You will notice if you haven’t already that every business tends to give (biased) advice according to the program 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 very occasional conditions where a debt consolidation loan is the right choice. Typically however the issue with them is all it is actually doing is bundling 5-15 different debts into one huge debt. If you are battling to pay all your various loans now why do you think it will be magically easier to have one enormous debt. Just to make it all even worse you generally have to pay up front for the luxury of this alternative.
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?
Generally the answer is yes. If this is a serious worry for you then the best way to get the answer is to get in touch with us here at Bankruptcy Experts Wyong on 1300 795 575 and once we have learnt about your predicament we can give you a crystal clear picture over the phone.
Practically everyone is emotionally connected to their house, its where the children have grown, its where you enjoy life on a day to day basis. People typically think its an inescapable consequence of bankruptcy and as a result they push themselves to the brink of madness to not lose the family home.
Will the bank let me keep my house despite the fact that I’m a bankrupt?
Why you may ask would the bank want bankrupt clients wouldn’t they choose to sell your house and not take the risk? The bank that has generously lent you the cash for your house is making good money every month in interest from you, month in month out, as long as you maintain to date with your repayments then the bank wants you in there at all costs. Ultimately however it’s not the bank’s call if the trustee determines that there is enough equity in your home the trustee will force you and the bank to sell your home.
What things determine if I will lose my house?
If you are up to date with your repayments then the most significant issue is equity. The trustee has a responsibility to gather up as much money to help pay your bills once you file for bankruptcy. Equity is the trick here. If you have $300,000 equity in your home and you have $100,000 worth of debt and no other way to pay the debt then the trustee sees you equity as a way to pay back your debt, so the trustee will sell your house pay back the debt and give you whatever remains.
How is equity determined?
Generally a registered valuer from the Wyong 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 phone us for how to go about this process so that you can have peace of mind 1300 795 575. Or for a greater exposition about how your home will be considered feel free to download “The Big 5” e-book.
Suppose my partners name is on the house loan?
Another huge issue is possession, oftentimes houses are bought in joint names. Put simply a couple may have bought a house 50/50 using both incomes to make the monthly payments. If one partner declares bankruptcy and the other partner doesn’t, the equity is only factored on the 50 % of the house.
So basically if you have a home in joint names and your total equity position is $100,000 then your actual equity is fifty percent of that $50,000.
It sounds like I have very few options when if comes to my house?
No not really there are many choices readily available to you when it comes to your house or any other asset when declaring bankruptcy. You will need to get the right assistance about this however, getting it wrong could be deadly. If you have questions feel free to phone 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 learn that you are bankrupt. 1. Individuals 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 release for them to access your credit file. You only ever do this we you apply for a loan. 4. You will be listed on the National Insolvency Index it on the web somewhere, its hard to find and you need to pay to see if someone is bankrupt on it.
At Bankruptcy Experts Wyong we are completely mindful that there is still a stigma about bankruptcy we appreciate this concern in fact we can help make sure that if you declare yourself bankrupt you will not need to go to court or get your name in the papers or be publicly made out to be a criminal. We can help ensure bankruptcy is easy and quick. In fact the whole process will only take a few days. It permits ordinary people to get out of debt and on with their lives. For more detailed information about your job download “The Big 5” e-Book.
Will I lose my job if I file for bankruptcy?
The answer to the question is maybe. The problem with some vocations 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 tough for you.
What I would advise is that you do your own prep work here, do the groundwork and review that process first prior to filing for bankruptcy because that may help you make a decision. Check if your profession is on the list below. If it is, I ‘d speak to them personally and describe your circumstance. Several organizations won’t have a problem with your bankruptcy as long as it wasn’t accompanied by shady or suspicious behavior.
If you think you employment may be had a bearing on by your possible bankruptcy call us here at Bankruptcy Experts Wyong on 1300 795 575.
BANKRUPTCY AND INCOME
Will my earnings be affected if I go bankrupt?
The answer to the question is perhaps. The first thing you have to know about going bankrupt is there is no constraint on how much you can earn. However, I will identify that your income is a significant consideration when wading whether you need to go bankrupt.
The first thing you need to know is 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 annually. A dependant is someone who lives with you and earns less than $3,124 per year (no matter their age).
You can apply for a hardship variation that raises the threshold amount, if you have expenses such as medical, child care, considerable travel to and from work, or a scenario where your spouse used to work but is no longer able to add to the household income.
Child support is always taken into consideration 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 example if you pay $5,000 child support each 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 due to income that it is not an economically viable option to file for bankruptcy because you earn way too much in comparison to the debt you have.
Just how much of my pay can I retain?
Below is set out for you the base amounts that you keep out of your incomes during the period of your bankruptcy. The Threshold Amount that you can keep is basically your net income after tax and child support (if applicable) is deducted. If you’re in your own business while bankrupt, then certainly it’s also after net (after tax) business expenses.
Your net income could be adjusted to consider things like salary sacrifice and excessive superannuation payments etc. Your bankruptcy trustee will have to determine your real net income according to the bankruptcy rules.
The income threshold numbers are also per person, and they are adjusted by the government every March and September to take into account the movements in the cost of living.
With no dependents your net income may be $52,543.40 net per per year, i.e. that’s approximately $1,010.45 net per week in the hand pay. This is your spending money. It’s all yours, it’s what you can keep, and so everything over that is split 50/50 with your bankruptcy trustee.
With 1 dependent your net income can be $62,001.21 net per annum, i.e. approximately $1,192.33 net per week in the hand pay. This is your pocket money. It’s all yours, it’s what you can keep, and so anything over that is split half and half with your bankruptcy trustee.
With 2 dependents your net income may be $66,730.12 net per per year, i.e. approximately $1,283.27 net per week in the hand pay. This is your pocket money. It’s all yours, it’s what you can keep, and so everything over that is split 50/50 with your bankruptcy trustee.
With 3 dependents your net income may be $69,357.29 net per per year, i.e. an average of $1,333.79 net per week take home pay. This is your spending money. It’s all yours, it’s what you can keep, consequently anything over that is split 50/50 with your bankruptcy trustee.
With 4 dependents your net income can be $70,408.16 net per per year, i.e. an average of $1,354.00 net per week take home pay. This is your spending money. It’s all yours, it’s what you can keep, and so anything over that is split 50/50 with your bankruptcy trustee.
With 4 + dependents your net income can be $71,459.02 net per annum, i.e. around $1,374.21 net per week in the hand pay. This is your pocket money. It’s all yours, it’s what you can keep, and so anything over that is split 50/50 with your trustee.
If you believe that your condition is more challenging, then please get competent advice. If you have a particular income question just call us on 1300 795 575.
What can my partner earn if I go bankrupt?
There is no limit to what your spouse can earn. Your loved one can earn a million dollars and they will not be required to contribute to your debts.
What if my spouse/partner and I both need to go bankrupt?
If a husband and wife each go bankrupt, and say that they’ve got no dependants, then they can each earn $1,010.45 net. A straightforward way to understand it is the same income rules apply for each person in the home.
Who is considered a dependent?
When it come to bankruptcy a dependent is anyone you support who earns less that $3,343 per year.
BANKRUPTCY AND SELF EMPLOYMENT
Will I lose my small business if I declare bankruptcy?
The short answer is you don’t need to but you do need to get the right assistance. Company insolvency laws are very involved and you need to tread carefully if you wish to continue to be self-employed.
You may already recognize that you can no longer be the director of a Pty Ltd Company if you are bankrupt, however that doesn’t automatically 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 remove your business debts so you can get a fresh start.
Should I put my company into liquidation?
One of the main reasons you may wish to consider liquidation instead of bankruptcy is because if you liquidate your company, it doesn’t essentially mean you need to declare bankruptcy. In Australia, businesses that become insolvent have a few options, such as liquidation, voluntary administration and so on. If you want to know more about liquidation and company re-structuring, visit the next page of this website, as there is so much more about it there and or download “The Big 5” e-Book. Remember, it’s the individuals who declare bankruptcy, not businesses.
This is a perplexing area, so get some professional advice on this one if you have a company. Usually speaking, the debts in a business and personal debts go hand in hand when a business owner goes bankrupt.
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 affects their capability 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 declare bankruptcy 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” rising up out of the ashes of an old company.
Don’t get overly pressured about what you can and can’t do as a business owner; just get the right advice and call Bankruptcy Experts Wyong today 1300 795 575.