Bankruptcy in Gold Coast - does it matter if it is voluntary?

When it comes to Bankruptcy Gold Coast, quite often people aren't aware that there may be both voluntary, and involuntary bankruptcy - the two have different methods and policies.

Involuntary bankruptcy happens when someone you owe money to applies to the court to declare you bankrupt. Commonly when you get one of those notices, you have actually 21 days to pay all the debt. If you don't, then the creditor goes back to the court and requests the court to issue a sequestration order that declares you bankrupt. A trustee is assigned, and then you have 14 days to get the documents in then afterwards you are bankrupt.

You can challenge 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. Other than the way you became bankrupt there is in reality no difference between Involuntary Bankruptcy and or Voluntary Bankruptcy - once you are simply declared bankrupt, they're conducted to in the very same way.

However, when it comes to Bankruptcy for this, the stress and anxiety, torment and fear that accompanies this process is incredible. If you think you are likely to be made bankrupt by someone, get some advice 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 else bankrupt you. Once you are bankrupt, it's generally far too late.

Voluntary Bankruptcy

On the other hand, when it comes to Bankruptcy, sometimes there are moments that it is the best option. So you may need to ask yourself, 'when should I consider voluntary Bankruptcy?'.

This question is not the very same for each person of course, but typically I find that one way you could work it out is to figure out how long it will take you to pay each one of your debts - if its longer than 3 years (the period you are declared bankrupt), then this may 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 rate she was paying 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 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 affect how you have to approach Bankruptcy.

In many ways, the ease with which companies/credit providers can default your credit file is unreasonable. The punishment doesn't seem to equal the crime in my book. So if you actually have defaults on your credit report for 5 years, bear in mind that bankruptcy is on your credit file for a total 7 years then its wiped off completely.

So if your credit rating is a big issue in trying to decide whether to take part in 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 variation is that with a DA or PIA you repay the money and nevertheless have it on your file for 7 years.

Bankruptcy

I have stated the word a few times now, but when it comes down to it, Bankruptcy is the biggest part, and the element most people are afraid of when they come to me to go over their financial situation and Bankruptcy. The other side of crime and punishment equation is bankruptcy, and in this 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 to countries like the United States, our bankruptcy laws are quite generous.

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 assumes 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 all 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 much more that can be said about doing this and Bankruptcy in general but the purpose of this blog was to help you decide between a few available options. When getting some advice, bear in mind that there are always possibilities when it concerns Bankruptcy in Gold Coast, so do some investigation, and Good luck!

If you would like to find out more about what to do, where to turn and what questions to ask about Bankruptcy, then don't hesitate to get in touch with Bankruptcy Experts Gold Coast on 1300 795 575, or visit our website:bankruptcyexpertsGoldcoast.com.au.