A Debt Agreement, or Part 9, is a formal agreement between a debtor and their creditors where a compromise is reached regarding the repayment of debt.
Debt Agreements are all about providing a solution to people who are experiencing difficulty in meeting their financial commitments.
If you find you are struggling with your debts a Debt Agreement could the best solution for you.
Below we have listed some of the most commonly asked questions about Debt Agreements to help you decide, however, if you would still like to know more, please call 1300 802 905 and talk to one of expert consultants.
How Does a Debt Agreement Solve My Debt Problems?
A Debt Agreement will be able to:
- Combine your unsecured debt expenses into one manageable repayment amount
- Stop harassment from debt collectors
- Freeze interest charges, saving you thousands
- Stop court imposed remedies relating to your debts
Am I eligible for a Debt Agreement?
There are a number of criteria you need to meet to enter into a Debt Agreement:
- Your take home pay (after tax income) of under $1,451.88 per week (or $75,498.15 annually)
- Your unsecured debts must not exceed $100,664.20
- You must not have filed for bankruptcy or have had a Debt Agreement in place at any time over the last 10 years
- Any assets you own must not be worth more than $100,664.20
If you fit the above criteria, then you may be eligible to apply for a Debt Agreement.
What are the consequences of a Debt Agreement?
- The ability of the debtor to obtain further credit is affected. Details may also appear on a credit reporting organisation’s records for up to seven years.
- All unsecured creditors are bound by the debt agreement and are paid in proportion to their debts.
- Creditors cannot take any action against the debtor or property of the debtor to collect their debts.
- A debtor must disclose that s/he is a party to a debt agreement if incurring debt or obtaining goods and services in excess of the threshold.
- If trading under a business name or assumed name (whether alone or in partnership) the debt agreement must be disclosed to all people dealing with the business.
- A debtor who proposes a debt agreement commits an act of bankruptcy. A creditor can use this to apply to court to make the debtor bankrupt if the proposal is not accepted by creditors.
- The debtor’s name and other details appear on the National Personal Insolvency Index (NPII), a public record, for the proposal and any debt agreement.
Debt Helpline is a part of one of the largest and most trusted Debt Agreement Administrators in Australia. We help thousands of people every year who are now well on their way to being debt free, if they aren’t already!
Take the first step and find out if a Debt Agreement is right for you. Contact one of our expert debt consultants on 1300 802 905 and feel the weight of the world lift from your shoulders.