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Debt Agreement case study

Debt Agreement Case Study

John and Jocelyn had been struggling to pay their personal loan and credit card debts for over 12 months. Their problems started when John was retrenched about 18 months ago and it took him 5 months to find another job.

During this period when John was unemployed, their creditors did not receive many repayments and despite their circumstances, some creditors lodged defaults on their credit reports and finally threatened legal action which included garnishing John's wages.

The Problem

John and Jocelyn had been unable to bring their personal loan and credit card accounts up to date. All their loan accounts were in arrears and they did not have the money to pay them off. Their debts totalled $32,800. Their minimum monthly repayments were $1,150, however, they only had $410 left over each month after they met their living expenses. Both John and Jocelyn wanted to repay their debts and did not want go bankrupt. A snapshot of their loan accounts showed the following:

Loan Account Interest Rate (%) Balance Min. Monthly Repayment
Credit Card 17.50 12,500 375
Credit Card 17.50 8,500 255
Personal Loan 12.50 4,800 310
Store Card 27.00 7,000 210
Total   $32,800 $1,150

The Solution

Fox Symes assisted John and Jocelyn in the preparation and submission of a Debt Agreement. A Debt Agreement is a formal arrangement between John and Jocelyn and their creditors.

The Debt Agreement would mean John and Jocelyn would have to pay $410 each month for 4 years to their creditors. In total they would pay their creditors $19,680. Their creditors would agree agreed to waive all interest on their debt and accept $19,680 of the $32,800 they owed or 60c in the dollar as full and final settlement of their debt. At the end of 4 years John and Jocelyn would be debt free.

With the assistance of Fox Symes, creditors approved the Debt Agreement. Fox Symes is the largest provider of debt agreements in Australia.

More information on Debt Agreement

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.

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  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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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.

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

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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
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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.
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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.