Personal Insolvency Agreement

What is a Personal Insolvency Agreement?

A Personal Insolvency Agreement is a legal and binding agreement between you and your creditors. It is also referred to as a Part X Agreement of the Bankruptcy Act.

It is generally for individuals who do not meet the threshold requirements for a Debt Agreement.

This is an alternative for you and your creditors to bankruptcy. The agreement includes your proposal to the creditors of terms you can afford to deal with your unsecured debts. Should the creditors agree it is then processed through a Government Agency known as the Insolvency Trustee Service of Australia (ITSA).

Benefits

The benefits of entering into a Part X Personal Insolvency Agreement are many and are primarily to avoid official bankruptcy and its limitations on your lifestyle. You are able to consolidate your unsecured debts into one regular repayment you can afford.

Upon approval of your personal insolvency agreement the amount of each of your debts is frozen, meaning the outstanding amounts you owe to your creditors are fixed and no further interest continues to accrue. From that point, Debt Rescue liaises with the creditors – no further calls should be received from your creditors.

Consequences

Quite simply, make no mistake, if you fail to meet your obligations under the Personal Insolvency Agreement by not making your repayments on time and in full, the creditors are able to pursue all avenues for recovery.

They are also able to terminate or void your agreement.

Is this an option for you?

If so, contact us for a private and confidential discussion with one of our experienced and understanding franchisees.