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Bankruptcy or debt agreement: what’s the best option?

21 October 2015  |  2 Comments

Bankruptcy or debt agreement: what’s the best option?

Despite your best efforts, are your debts out of control? 

If you are unable to get your debts under control, it might be time to think about taking action. Two common solutions are signing a debt agreement or filing for bankruptcy. Before you decide on bankruptcy as your last resort, here are some important facts you need to know about debt agreements.

Signing a debt agreement

A debt agreement allows you to make a repayment offer to your creditors based upon what you can reasonably afford to pay. If the agreement is accepted by your creditors, it becomes a legally binding arrangement in which you make regular repayments until the end of the term — which is no more than five years.

Advantages

  • Interest is frozen on all your provable unsecured debts.
  • You will no longer receive calls from debt collectors about the debts captured by your debt agreement.
  • You will have a single, manageable regular repayment to pay off the debts captured by the debt agreement rather than having to make repayments to multiple banks and lenders.
  • It is a legally binding agreement, and one that your creditors must adhere to.
  • Once the agreement is finalised, you are released from your unsecured debts captured by the debt agreement.

Disadvantages

  • The debt agreement is listed on your credit report for five years, which could affect your ability to obtain credit during this period.
  • A public record of your debt agreement will be permanently listed on the National Personal Insolvency Index (NPII). This is searchable through the Australian Financial Security Authority (AFSA) website.
  • Debt agreements have an impact on certain careers as some professional bodies and trade associations may impose certain restrictions or conditions should a member or licensee enter into a debt agreement (e.g accountants, lawyers, barristers, tax agents etc). 

Fox Symes is the largest provider of debt solutions to individuals and businesses in Australia. Fox Symes helps over 100,000 Australians each year resolve their debt and take financial control.

If you are in debt and want to know more about the solutions available to you contact us on 1300 098 127 or fill out the short contact form.

Have your Say


Comments (2)

Hi just a query can I apply for a loan once I have paid off my Debt Agreement???

lynette Gordon, 11th Feb 2016

Reply to this comment

Hi Lynette,

You will be able to apply for a loan, however the debt agreement is listed on your credit report for five years, which could affect you successfully obtaining a loan during this period.

Kind regards,
Fox Symes

Fox Symes, 22nd Feb 2016

Reply to this comment

Enquire Now – Just 4 questions to answer

  1. 1 Do you have a home loan? We can still assist even if you do not have a home loan.
  2. 2 Do you have unsecured debts of $7,000 or greater? Credit cards, store cards and personal loans are types of unsecured debts. Mortgages and car loans are not.
  3. 3 Do you receive a regular income?
  4. 4 Have you been bankrupt in the last 13 years?
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Yes! We can help you

Option 1: Call us now

Free Call 24 hours, 7 days a week

1300 098 127

Fox Symes is the largest provider of debt solutions to individuals and businesses in Australia. We help over 100,000 Australians each year resolve their debt and take financial control.

Option 2: We call you

Unfortunately, we are unable to assist you.

For further assistance we recommend you:

  • Speak to your Creditors
  • Call AFSA on 1300 364 795
  • Speak with a Financial Counsellor
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Unfortunately, we are unable to assist you at this time.

Please contact us for assistance once you have secured a regular income.

We look forward to your call.

< Go Back

Unfortunately, we are unable to assist you.

You need to have over $7,000 in unsecured debt to apply.
For further assistance we recommend you:

  • Speak to your Creditors
  • Call AFSA on 1300 364 795
  • Speak with a Financial Counsellor
< Go Back

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  1. Credit cards, store cards and personal loans are types of unsecured debts. Mortgages and car loans are not.
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Australian residents only.

  1. Credit cards, store cards and personal loans are types of unsecured debts. Mortgages and car loans are not.