When it comes to Bankruptcy Adelaide, normally people aren't aware that there can be both voluntary, and involuntary bankruptcy - the two have distinct approaches and guidelines.
Involuntary bankruptcy occurs when a person you owe money to involves the court to declare you bankrupt. Typically when you get one of these kinds of notices, you have 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 appointed, and then you have 14 days to get the documents in and then you are bankrupt.
You can contest a bankruptcy notice by going to court following the 21 days have expired and put your case forward, to prevent it going to the next level. Other than the way you became bankrupt there is in reality no distinction between Involuntary Bankruptcy and or Voluntary Bankruptcy - once you are declared bankrupt, they're overseen to in the same way.
However, when it concerns Bankruptcy for this, the stress, torment and fear that accompanies this process is incredible. If you think you are prone to be made bankrupt by someone, get some suggestions and act on that advice. Generally I've found it's always better to know what you can and can't do before you have someone bankrupt you. Once you are bankrupt, it's normally far too late.
However, when it comes to Bankruptcy, sometimes there are moments that it is the most effective option. So you may want to ask yourself, 'when should I consider voluntary Bankruptcy?'.
This question is not the very same for every person of course, but basically I find that one way you could work it out is to figure out how long it will take you to pay all 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 came 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 off her account, and it was 35 years! Imagine 35 years for one credit card bill.
Credit rating damage can really help you think this through. If you move house and fail to remember to pay your $30 phone bill for 6 months more, it's very likely the phone service will default your credit file. That default will remain on your file for 5 years, so for $30 you can have your credit file very seriously damaged for that period of time-- and all of this will impact how you need to approach Bankruptcy.
In many ways, the ease with which companies/credit providers can default your credit file is unjustifiable. The punishment doesn't seem to match the crime in my book. So if you already have defaults on your credit report for 5 years, keep in mind that bankruptcy is on your credit file for a total 7 years then its erased completely.
So if your credit rating is a big aspect 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 change is that with a DA or PIA you repay the money and nevertheless have it on your file for 7 years.
I have stated 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 discuss their financial situation and Bankruptcy. The other side of crime and punishment equation is bankruptcy, and in this specific country the arrangements are very generous: you can go bankrupt owing millions of dollars and after 3 years it's all finished with no strings attached. Compared with countries like the United States, our bankruptcy laws are quite good.
I don't pretend to know why that is but a couple of hundred years ago debtors went to prison. These days I suppose the government finds that 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 costs the taxpayer anyway.
Bankruptcy wipes all your debts including ATO debts with the exception of a few things:
· Centrelink Debts, Court Fines like parking and speeding fines.
· HECS or Fee Help loans.
· Money to pay for a car accident if the car was not insured.
There is much 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 possible options. When getting some advice, keep in mind that there are always choices when it involves Bankruptcy in Adelaide, so do some groundwork, and Good luck!
If you wish to find out more about exactly what to do, where to turn and what questions to ask about Bankruptcy, then don't hesitate to get in touch with Bankruptcy Experts Adelaide on 1300 795 575, or visit our website:bankruptcyexpertsAdelaide.com.au.