Bankruptcy Gold Coast, So what is the Deal with Debts?

So what Debts are erased if I go Bankrupt?

The basic answer is that when it comes to Bankruptcy most debts are wiped, and I have included a compendium below for you to look at.

But, put simply some of the exceptions are Centrelink Debts, Child Support, Court fines (like speeding fines) together with any debts arising from uninsured Motor-vehicle claims and educational debts including HECS or FEE-HELP. These debts are not wiped out when you file for bankruptcy.

What about Secured Debts?

A secured debt is a car loan or a home loan; it is a debt that has some real security connected to it. So for instance if you buy a new car for $40,000 dollars the security for this car is the actual car itself.

So, can my secured debts be removed if I file for bankruptcy?

Yes. If you have a car loan for $40,000 you can have that debt cleared away if you simply return the car. So the lesson is that you cannot have your cake and eat it too (so to speak), so yes all of your secured debts might be wiped but the asset has to be sold or returned. This is just one component that, when it comes to Bankruptcy, it is important to get professional help - like that available at Bankruptcy Experts Gold Coast.

What about my Tax Debts with the ATO can they be removed If I go bankrupt?

Yes they can, both business and personal debts owing to the ATO can be cleared away with bankruptcy. If you have a business with any sort of debts get some advice because it is not always so easy. Feel free to call us right here over at Bankruptcy Experts Gold Coast if you have any questions on 1300 795 575. Or feel free to check out our website: www.bankruptcyexpertsGoldCoast.com.au

What about my business or Company debts?

In some cases when it concerns Bankruptcy we can aid you with your business debts, call us about this first. Remember bankruptcy applies to an individual not companies, trusts or businesses. Usually you may need to liquidate a company to deal with the debt this way. And when it comes to Bankruptcy, it can be a confusing area, so remember there are implications for a business owner such as insolvent trading. At Bankruptcy Experts Gold Coast we specialise in business and personal debts so contact us here at Bankruptcy Experts Gold Coast if you have any questions regarding Bankruptcy on 1300 795 575. Or feel free to visit our website: www.bankruptcyexpertsGoldCoast.com.au

Bankruptcy, Will I lose my Superannuation?

Bankruptcy in Australia can be complicated and difficult to understand. A question we commonly get asked here over at Bankruptcy Experts Gold Coast is 'what happens to my super if I declare Bankruptcy'? The answer for most is easy, if your super is normally in a regulated fund or industry fund like Sunsuper or Host Plus then nothing happens; your super is 100 % safe when it comes down to Bankruptcy.

What if I have a Self Managed Super Fund?

This is a growing concern, think about the growing number of members of Self-Managed Super Funds ("SMSFs") over the last few years; the ATO tells us it has grown Australia-wide from 758,589 in 2009 to 1,011,689 in 2014. So what happens to these Superfunds when it involves Bankruptcy?

Remember Bankruptcy Experts Gold Coast is not indicating this post is the complete story, if you have any questions feel free to call us on 1300 795 575. Whether you call us or another person it doesn't matter, just please don't walk into bankruptcy blind when it comes to your SMSF indeed we highly recommend you obtain both legal and financial advice before proceeding with any of the actions recommended in this article.

What is a Disqualified Person?

First and foremost, if you are considering Bankruptcy, you can not be a part of a SMSF. Why? Because if you are being confronted by bankruptcy, you will be labeled as a 'disqualified person'. And a disqualified person cannot operate as an Individual Trustee. This poses a problem because usually most of the SMSFs are just 2 people, which means both of these members need to also be the individual trustees. The role of trustee poses a lot of legal rules, and if you are in this role I would highly recommend you to get knowledgeable about them all-- for example the fact that you can not 'know or suspect' that one of you are bankrupt. So you can see how an individual bankruptcy can be rather detrimental to a SMSF and as you can imagine the process of Bankruptcy for a SMSF is rather convoluted.

How much time do I have to restructure my SMSF Fund after I'm bankrupt?

So what develops if one of the members of an SMSF does enter Bankruptcy?

For starters, the SMSF will need to be reorganized. This means that you will want to consider your overall structure and see to it that it is meeting the basic conditions, including things like having a new trustee that is not encountering issues with Bankruptcy. The Australian Tax office will supply you a 6 month 'grace period' to get this done before you face penalties. And keep in mind, sometimes the absolute best plan would be to simply roll the fund into an industry or corporate fund.

Beyond these large scale reorganizing issues, there is a lot of paperwork to deal with too, and you need to be constantly keeping the ATO informed of what is happening. This means you will need to let them know that you have a bankruptcy problem with your current trustee, that they are being removed as soon as possible know who the new trustee/director is. The Bankrupt will also need to inform the ATO using the form NAT 3036 (Found on the ATO website) and they must also notify ASIC of their resignation.

In the course of that 6 month period you will need to remove the Bankrupt from the SMSF-- including their property and assets. Remember if you are not exactly sure call Bankruptcy Experts Gold Coast for some free advice on 1300 795 575.

What if I use a single member fund?

If you are a single member fund, then you will need to appoint a new director, and it will then end up being their obligation to oversee the sale and transfer of assets into a managed fund. If there are two or more members, than the bankrupt member will have to resign and the other member will clear away the property and halve the proceeds. They would then have to decide if they would like to remain as a single member SMSF, or if they need to roll it all into a managed fund. If both members are entering bankruptcy, then they would need to sell all assets immediately and move the liquid assets to the managed fund.

From this you can notice how when it comes to Bankruptcy, even when one single member is running into issues, it can affect the very existence of an SMSF. If you are currently facing this trouble yourself, or with a partner in a SMSF, please seek financial advice to make sure you are fulfilling the ATO requirements.

A simple solution ...

As I recommended earlier, a simple solution to your SMSF problem is to put your super back into a normal regulated managed fund prior to bankruptcy and save yourself all the frustrations outlined above. Bankruptcy is never easy, but getting proper advice is the best 1st step. If you want to discuss your possibilities further, give us a call at Bankruptcy Experts Gold Coast or visit our website: www.bankruptcyexpertsGoldCoast.com.au or just call us on 1300 795 575.

Bankruptcy in Gold Coast - Will I lose my home if I go bankrupt?

Bankruptcy Gold Coast is a challenging process, but I know from meeting with thousands facing the prospect of bankruptcy over the years, that not much concerns people more than the thought of losing the family house. Almost every person is emotionally connected to their home - it's where the children have grown up, it's where you enjoy life on a day to day basis.

Will you lose your home if you go bankrupt? The response is a resounding maybe. (not very useful, I know) People generally imagine it's an inevitable consequence and a part of Bankruptcy, and hence push themselves to the brink of insanity to not lose the family home. But when it comes to the whole process of Bankruptcy, a key strength of Debt Agreements and Personal Insolvency Agreements is you can keep your house. The reason is simple: you've accepted to pay back the debt you are in.

So how is it possible to keep my Gold Coast house, you ask? It's easier if I explain the basic idea behind the Bankruptcy process as administered by the trustee, then you'll have a clearer picture.

The purpose of the bankruptcy trustee is to firstly abide by the regulation of the bankruptcy act 1966 (it's a very dry read about 600 pages if you are intrigued).

Within that regulatory framework, the trustee is to help recuperate monies owed to your creditors, that is done in a bunch of various ways but it mainly comes down to income and assets. The trustees role is to collect payments beyond your income threshold. The other role is to sell any assets that can contribute to repaying your debts.

What this seems is that yes the trustee will sell your house right? Not always. The only reason the trustee will sell any asset including your house is to get money to repay your debts. If there is no equity on your property then it's pointless to sell your home. This is happening increasingly since the GFC as house prices in many regions have been heading south so what you paid 4 years ago may not actually reflect the price today.

A quick word of advice here if you have a house in Gold Coast and are looking at Bankruptcy: get a specialist to help you through this process, there are plenty of variables in these scenarios that have to be considered.

You might wonder, why would the bank want bankrupt clients? wouldn't they hope to sell your house and not take the risk? The bank that has kindly lent you the money for your house is generating good money every month in interest out of you, month in month out, so long as you keep up to date with your payments then the bank really wants you in there at all costs. Essentially however it's not the bank's call if the trustee decides that there is ample equity in your house the trustee will force you and the bank to sell the house.

When you file for bankruptcy you are asked to put down the value of your house and the quantity you owe on the house. A tip if you are aiming to work out the value of your house: use a registered valuer as this will provide you peace of mind, don't use your neighbours' gut feel suggestions or a real estate agents advice to arrive at this figure. When you get a valuer out to your property, make sure you tell the valuer to value the property for a quick sale, make certain you mow the lawn and don't leave the kitchen in a mess also.

Valuers used to give two valuations: one for a quick sale and one for a well marketed non time delicate sale. Nowadays that's not the case, but if you meet them and let them know you need to sell the house in the next 30 days you may sway the result. The idea is that you want a real sell now figure.

There are two reasons this valuation technique is critical to you: one you will certainly have peace of mind ascertaining the market value of your house, and then you can easily build your equity position. The second thing is, your property may be worth far more than you thought. Get some suggestions before carrying this out. The number of times I've met with clients that have sold their family home of 20 years just to find out I could of helped them keep it; unfortunately this happens all too often

When it concerns Bankruptcy and houses, another big consideration is ownership, often houses are purchased in joint names. Simply put a couple may be a house 50/50 using both incomes to make the payments. If one party declares bankruptcy and the other party does not, the equity is only factored on the 50 % of the property.

When it involves Bankruptcy, this is just one of possibly numerous scenarios that are likely when it comes to the family home. Bear in mind the non-bankrupt party can buy the bankrupt's part of the home in bankruptcy also. I need to repeat this but get some help on this area of Bankruptcy because it is very tricky and every case is different.

If you would like to learn more about what to do, where to turn and what questions to ask about Bankruptcy, then feel free to get in touch with Bankruptcy Experts Gold Coast on 1300 795 575, or visit our website: www.bankruptcyexpertsGoldCoast.com.au.