When it comes to Going Bankrupt Alice Springs, usually people aren’t aware that there can be both voluntary, and involuntary bankruptcy – both have unique methods and policies.
Involuntary bankruptcy takes place when a person you owe money to involves the court to declare you bankrupt. Usually when you get one of these notices, you have normally 21 days to pay all the debt. If you don’t, then the creditor goes back to the court and asks the court to issue 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 object to a bankruptcy notice by going to court right 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 fact no distinction between Involuntary Bankruptcy and or Voluntary Bankruptcy – once you are declared bankrupt, they’re administered to in the exact same way.
However, when it concerns Going Bankrupt for this, the stress, torment and fear that accompanies this method is incredible. If you think you are probable to be made bankrupt by someone, get some advice 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 somebody bankrupt you. Once you are bankrupt, it’s usually far too late.
Nevertheless, when it comes to Going Bankrupt, sometimes there are moments that it is the best option. So you may have to ask yourself, ‘when should I consider voluntary Bankruptcy?’.
This question is not the very same for each 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 every one of your debts – if its longer than 3 years (the period you are declared bankrupt), then this may serve to help you make that decision, and help you to understand Going Bankrupt.
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 help you think this through. If you move house and forget 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 sit 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 impact how you need to approach Going Bankrupt.
In many ways, the ease with which companies/credit providers can default your credit file is unfair. The punishment doesn’t seem to equate to the crime in my book. So if you already have defaults on your credit report for 5 years, remember 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 contrast is that with a DA or PIA you repay the money and still 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 go over their financial situation and Going Bankrupt. The other side of crime and punishment equation is bankruptcy, and in this country the provisions are very generous: you can go bankrupt owing millions of dollars and after 3 years it’s all over with no strings attached. As compared to countries like the United States, our bankruptcy laws are very good.
I don’t claim to know why that is but a couple of hundred years ago debtors went to prison. Nowadays 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 in turn costs the taxpayer anyway.
Bankruptcy wipes every one of 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 take care of a car accident if the car was not actually insured.
There is a lot more that can be said about this and Going Bankrupt 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 possibilities when it involves Going Bankrupt in Alice Springs, so do some legwork, and Good luck!
If you want to learn more about just what to do, where to turn and what questions to ask about Going Bankrupt, then feel free to reach out to Bankruptcy Experts Alice Springs on 1300 795 575, or visit our website:bankruptcyexpertsAlice Springs.com.au.