Is Bankruptcy Right for Me?

Bankruptcy is one of the hardest things anyone has to ever deal with. Making the best decision is difficult. That is why we have created a free eBook – The Big 5 – to help you make a fully educated decision. At Bankruptcy Experts Coffs Harbour we recommend you do not move forward with bankruptcy before you have read this, and you have the answers to the 5 big bankruptcy questions.

Is Bankruptcy Right for me
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Big 5 Questions

– Is going bankrupt right for me?
– Will I lose my job?
– How will my income be affected?
– Can I keep my house or car?
– Will I lose my business or can I still be self-employed?

If you are considering bankruptcy, having the ability to answer these questions is essential. Once you have all this information then you will understand exactly what will happen to your business and assets should you choose to declare bankruptcy. Do not hesitate to download our eBook for free and educate yourself today. Or, if your concerns are more complex, call us at Bankruptcy Experts Coffs Harbour directly on 1300 795 575.

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Bankruptcy Options

Bankruptcy vs
Debt Agreement

Is going bankrupt my only choice? No of course not you always have a choice, you may want to consider a debt consolidation loan. However, the most popular option considered instead of bankruptcy is a Debt Agreement (Part IX). Study the graph to work out the relative benefits and disadvantages of Bankruptcy, Debt Agreements, and Personal Insolvency Agreements, so you can make an informed choice.

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Why Do Some Business Say Debt Agreements or Personal Insolvency Agreements?

There is a good reason some bankruptcy services invest a lot on TV commercials … there is a lot in it for them if you choose them … In a desperate bid for your custom, things quickly turn into a cat fight, with one business turning against another. And everybody claims they are the best. We are not here to be competitive. Here at Bankruptcy Experts Coffs Harbour we are here to inform you so you can choose for yourself.

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Debt Agreements

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Personal Insolvency Agreements

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Should I Consider a
Debt Consolidation Loan
?

A debt consolidation loan is in some cases the best plan. What the plan does is to pack all the various loans into one, much larger loan. There may be a fee to consolidate the debts. One of the biggest challenges to consider is your credit rating, typically people considering bankruptcy have a badly damaged credit rating so a debt consolidation loan is just not an option.

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Who Will Know About My Bankruptcy?

 

An individual’s personal privacy is a big deal when you file for bankruptcy. The days of your name being published in the paper as a bankrupt are long gone.
In fact, there are usually only four kinds of people who will learn about your bankruptcy:
1.) The people you personally tell.
2.) Your creditors or the people you owe money to.
3.) People who request to access your credit file, such as when you apply for a loan. (this involves you giving them authorization first), Applying for a loan is something you will not be doing for the 3 years you are bankrupt since nobody will give you a loan while you are bankrupt.
4.) Anyone who looks you up on the National Insolvency Index (which people have to pay to gain access to).
There is no necessity for you to worry, you are not a crook and you have actually not failed. You are simply somebody who wants to put an end to crippling debt and carry on with their lives. At Bankruptcy Experts Coffs Harbour, we are here to help. Download our Free ‘The Big 5’ e-Book for in-depth information about insolvency and your employment or give us a call on 1300 795 575.

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Bankruptcy and the Family Home

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If I File for Bankruptcy Can I Keep My House?

In many cases the answer is yes. If losing your house is a major issue for you then the very best way to find the answer is to call us here at Bankruptcy Experts Coffs Harbour on 1300 795 575. As soon as you tell us about your situation, we can provide you a very clear picture of your options over the phone. Practically everyone is emotionally linked to their home; it is where the kids have grown up, it is where you enjoy life on a day to day basis. People often pressure themselves to the edge of madness attempting to not lose the family house, presuming this is an unavoidable consequence of bankruptcy.

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Suppose My House Has a Lot of Equity?
What Can I Do?

If your house has lots of equity and you are still drowning in debt, there are still some options available to you. In fact, this applies also to vehicles or other assets you might have. In this situation what you cannot afford to do is presume that everything will be okay. It is the bankruptcy trustee’s job to sell whatever assets you have when you apply for bankruptcy and put that money towards your debts. Getting the wrong advice here could be disastrous! Before you take your next step get some advice, at Bankruptcy Experts Coffs Harbour we provide a complimentary initial consultation, so call us today on 1300 795 575.

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What If My Partner’s Name Is on the Mortgage?

Often when a couple purchase a home a single income is quite often not enough to get approval for the mortgage, so the bank or lender will usually have both of these partners sign up for the credit. Once the house is bought both names are listed as shared tenants on the homes mortgage and the title deed of the property. Let us say Mick and Susie, who reside in regional NSW, purchased a home 4 years ago for $400,000 with no deposit so their home loan was also $400,000. Mick is a plumber and needs to declare bankruptcy but Susie has an excellent job teaching at a high school and does not need to declare bankruptcy. Regrettably, the house has not increased in value in the 4 years they have owned it and they also have only managed to pay the interest on the home loan in that time. So ultimately, they still have a $400,000 home loan on a house worth $400,000. Mick can then file for bankruptcy and as long as they keep covering the mortgage, rates etc, they can continue to keep the house for the 3 years Mick is bankrupt.
This action will, in no way, impact Susie’s credit history rating or require her to go bankrupt at the same time. There is plenty to take in when it comes to homes and declaring bankruptcy so if you have concerns about your house, don’t hesitate about calling us at Bankruptcy Experts Coffs Harbour on 1300 795 575.

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How Is Equity Determined?

This is the most important part of this procedure. Why? Simply put, if you get it wrong you are going to lose your house. There are a variety of things you must understand here. First of all, your gut reaction or assumption about the true worth of your property is probably generous. The majority of people expect their house is worth far more than it actually is. When you declare bankruptcy the trustee may ask how you calculated the price for your house. In some cases they might ask for more detail about your valuation, perhaps a rates notice, a real estate agency’s appraisal or a registered valuation. A useful technique would be to search www.realestate.com.au then click the ‘Sold’ tab on that particular site and look for the most recent home sales in your street or neighbourhood. This will assist you to get some idea of the value of the market at the moment. Always remember, the valuation is based upon a quick sale not a sophisticated real estate agent’s marketing project. Understanding this step is essential, at Bankruptcy Experts Coffs Harbour we can give you guidance before moving on, call us on 1300 795 575.

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What Factors Would Contribute to Losing the House?

Equity! If you are up to date with your monthly payments then the most important issue in bankruptcy is equity. If you possess $300,000 equity in your house and you have $100,000 worth of unpaid debt and no other means to pay the debt then the trustee sees your equity as a way to pay your debt and so they will most likely sell your home to repay the unpaid debt and give you whatever funds remain from the sale.

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Will the Bank Let Me Keep My House Even If I’m a Bankrupt?

Why would the bank want bankrupt customers? Wouldn’t they want to sell your house and not take the chance on you? Consider this, the bank that has generously offered you the money for your residence is making a good monthly income in interest from you, month after month. Provided you keep up to date with your payments then the mortgage lender really wants you in your house at all costs. Having said that, you keeping your home is not the bank’s call. If a trustee makes a decision that there is enough equity in your home to liquidate it, they will force you and the bank to sell your home.

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What If I Have Received a Notice From the Tax Office?

One of the most important things to note is that YOU MUST NOT LET A TAX OFFICE NOTICE LAPSE. It will be best to get in touch with us at Bankruptcy Experts Coffs Harbour on 1300 795 575 as soon as you get a tax notice. We can then help you work through the procedures as rapidly as possible to get the most beneficial outcome for you.

When we have assessed your needs, we can create an action plan to help recommend to you the best course of action. From this point, you can evaluate your options and decide on where you go from there.

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Bankruptcy and Employment

Will My Employer
Be Advised?

Usually, there is no good reason for your employer to be advised of your personal bankruptcy. When you make over the income threshold and you are asked to make an income payment, you will plan those payments yourself – it does not go through your workplace.

Will I Lose My Job If I File for Bankruptcy?

When bankrupt there is a distinction between currently being employed and making an application for a new position. Rarely will you ever lose your job due to the fact that you have filed for bankruptcy. For example, it is difficult to get into the Defence Forces as a current bankrupt, but they do not terminate your job if you become bankrupt when you are already employed by them.

Each professional body has its own guidelines, and this varies from state to state. Our advice is to speak directly to your industry-specific experts, who will know precisely how your unique circumstance works in New South Wales. This is worth doing before proceeding with your bankruptcy, as it may be a critical factor in your decision. Check out the chart below for a list of some occupations where seeking further, industry-related assistance is a must. Some industries will not have a problem with your bankruptcy so long as it is all above board. Please feel free to call us at Bankruptcy Experts Coffs Harbour on 1300 795 575 with any questions you have.

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Bankruptcy Income Thresholds

How Much Can I Earn When I’m Bankrupt?

In NSW there is no limitation on just how much you can earn when you are bankrupt. Before filing for bankruptcy, however, it is important to consider your income and make certain bankruptcy is the best choice for you before proceeding. Find out just how much you can make before you have to start paying funds to your creditors via your trustee. There are also other things to consider with bankruptcy income such as Child Support, Hardship & Self Employment. If you are stressed over this simply call us at Bankruptcy Experts Coffs Harbour on 1300 795 575.

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Bankruptcy and Income

Every year in March and September the Government audits income threshold figures based on the latest cost of living. This means that the amount of money you are able to earn (net income, after tax and child support) while bankrupt is always fluctuating, and your trustee will have to establish your real net income. This real net income figure will depend on various factors such as child support, salary sacrifice, superannuation payments and business expenses.

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What Can My Partner Earn If I Go Bankrupt?

For the most part in New South Wales, your partner is seen as a totally separate entity in the eyes of the law and will not be affected financially by your bankruptcy. In the case of a joint loan, you should first seek further advice. Call Bankruptcy Experts Coffs Harbour today for an obligation-free chat on 1300 795 575.

Partner Bankruptcy
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Who Is Considered a Dependent?

A dependent can be any person, of any age, who resides with you and earns no more than $3,708 per year. If you have children who do not live with you full-time, and you pay child support for them, you cannot class them as dependents. By the way, Centrelink payments are considered income for your dependents.

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What If My Spouse or Partner and I Both Need to Go Bankrupt?

If, as a couple, you both have to declare bankruptcy and you have no dependents, then you are allowed to earn up to $1,083.01 net each. The same income rules apply to each person independently. If you have kids refer to the income thresholds in the chart above. If you have more questions call us at Bankruptcy Experts Coffs Harbour on 1300 795 575.

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