The benefits of a Debt Agreement include:
- Payments based on what you can afford
- You may be able to pay back less than what you owe
- You may not have to pay any more interest
- We speak to your creditors, so they can call us instead of you
- No more phone calls, letters or harassment
- One simple payment every week or fortnight
- Could save you thousands
- Get you back on your feet and take control
Credit Repair Australia have helped thousands of Australians take control of their unsecured debt by entering into a Debt Agreement.
Are there any consequences of entering into a Debt Agreement?
Yes. Whilst a debt agreement may be a good option to help you get out of debt, there are some things you should consider before entering into one.
Whilst a Debt Agreement is an alternative to Bankruptcy, submitting a Debt Agreement proposal is still classified as an “Act of Bankruptcy”. If the proposal is not accepted by creditors, a creditor can use this to apply to the court to make you Bankrupt
Both a Debt Agreement Proposal and a Debt Agreement are listed on the National Personal Insolvency Index (NPII)
A Debt Agreement will be listed on your credit report for 5 years from the date the agreement was made. However, if the agreement is terminated, it will be listed on your credit report for 2 years from the termination date, or 5 years from the date the agreement was made, whichever is longer.
What is a Debt Agreement?
If you are struggling with your current payments for your unsecured debts, but can afford to make some sort of offer for regular payment, a Debt Agreement may be suitable for you. We help you develop an offer which will be put to your creditors for them all to vote on. Should creditors accept your offer, it is possible that you could end up paying back less than the full amount of your debts.
A Debt Agreement isn't the same as Debt Consolidation because you aren't actually borrowing more money, however it is a way of consolidating your repayments. One other benefit of consolidating your payments instead of your debt is that you may not have to pay any interest.
What is unsecured debt?
A Debt Agreement focuses on your unsecured debt only. These include credit cards, personal loans, store cards, phone and utility bills and more. Dealing with your unsecured debt through a Debt Agreement can give you freedom to keep up with payments on your secured debt (like a home loan).
Unlike Bankruptcy, a Debt Agreement allows you to keep your house, car and other assets so long as you stay on top of the payments.
How does a Debt Agreement work?
First we work with you to create a budget and find out what you can afford, we then develop your offer into a proposal. We submit this proposal to be approved by a Government department, before it’s sent to your creditors to vote on.
If the majority in value vote yes to the agreement, all of your creditors will receive payments based on the offer. Even if they voted no or didn’t vote, you will only have to pay the amount offered to them. It is important to note that once accepted and entered into a Debt Agreement is legally binding.
Who can enter a Debt Agreement?
Most people can enter a Debt Agreement, however there are set limits on your debts, assets and income. We conduct a free financial assessment to ascertain if a Debt Agreement may be suitable for you, to help you make an informed decision.
If you are having trouble with repayments and are unsure about the options available give us a call now on 1300 298 834 or get in touch through the contact page .
Still have questions?