Is Bankruptcy Right for Me?

Bankruptcy is one of the hardest things anybody has to ever deal with. Making the right decision is not easy. That is why we have produced a free eBook – The Big Five – to help you make a fully educated decision. At Bankruptcy Experts Newcastle 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 vital. When you have all this information then you will know exactly what will happen to your business and assets should you decide to apply for bankruptcy. Do not hesitate to download our eBook for free and educate yourself today. Or, if your questions are more complex, call us at Bankruptcy Experts Newcastle directly on 1300 795 575.

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bankruptcy expert ebook

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We offer a No Obligation Free Consultation in over 40 locations throughout Australia, Brisbane, Canberra, Sydney, Melbourne, Gold Coast, Adelaide, Perth, Darwin, Hobart, Sunshine Coast, Newcastle and Geelong. Feel free to download our e-Book now.

Bankruptcy Options

Bankruptcy vs
Debt Agreement

Is going bankrupt my only choice? No of course not you always have a choice, you may wish to think about a debt consolidation loan. However, the most common option considered instead of bankruptcy is a Debt Agreement (Part IX). Study the graph to work out the relative advantages and drawbacks of Bankruptcy, Debt Agreements, and Personal Insolvency Agreements, so you can make an educated choice.

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

There is a 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 everyone claims they are the best. We are not here to compete. Here at Bankruptcy Experts Newcastle we are here to inform you so you can decide 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 often the best plan. What the plan does is to pack all the different loans into one, larger loan. There might be a fee to consolidate the debts. One of the biggest challenges to think about is your credit rating, often people considering bankruptcy have a badly damaged credit rating so a debt consolidation loan is simply not an option.

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Who Will Know About My Bankruptcy?

 

A person’s personal privacy is a big deal when you file for bankruptcy. The days of your name being posted in the paper as a bankrupt are long gone. In fact, there are generally only four kinds of people who will know 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 permission first), Applying for a loan is something you will not be doing for the 3 years you are bankrupt since nobody will offer 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 need for you to stress, you are not a criminal and you have not failed. You are simply someone who wishes to put an end to debilitating debt and carry on with their lives. At Bankruptcy Experts Newcastle, we are here to help. Download our Free ‘The Big 5’ e-Book for comprehensive 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 a lot of cases the answer is yes. If losing your home is a major issue for you then the very best way to find the answer is to call us here at Bankruptcy Experts Newcastle on 1300 795 575. As soon as you tell us about your situation, we can give you a really clear understanding of your options over the phone. Practically everybody is sentimentally linked to their house; it is where the kids have grown up, it is where you enjoy life on a day to day basis. People often push themselves to the edge of insanity trying to not lose the family house, assuming this is an unavoidable effect of bankruptcy.

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

If your home has lots of equity and you are still drowning in debt, there are still some options accessible to you. In fact, this applies also to cars or other assets you may have. In this scenario what you cannot afford to do is assume that everything will be ok. 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 recommendations here could be disastrous! Before you take your next step get some advice, at Bankruptcy Experts Newcastle we provide a free initial consultation, so call us today on 1300 795 575.

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

Commonly when a couple buy a house a single income is often not adequate 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 purchased 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 New South Wales, purchased a house 4 years ago for $400,000 without any deposit so their home loan was also $400,000. Mick is a plumbing contractor and needs to declare bankruptcy but Susie has a great job teaching at a high school and does not need to declare bankruptcy. Unfortunately, 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 essentially, they still have a $400,000 home loan on a house worth $400,000. Mick can then declare 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, affect 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 houses and declaring bankruptcy so if you have concerns about your house, don’t think twice about calling us at Bankruptcy Experts Newcastle on 1300 795 575.

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How Is Equity Determined?

This is the most essential part of this procedure. Why? Put simply, if you get it wrong you are going to lose your house. There are a variety of things you must understand here. Firstly, your gut reaction or assumption about the true worth of your property is most likely generous. The majority of people expect their house is worth much more than it really is. When you declare bankruptcy the trustee might ask how you calculated the price for your home. Sometimes they might request more detail about your valuation, possibly a rates notice, a real estate agency’s appraisal or a registered valuation. A practical strategy would be to search www.realestate.com.au then click on the ‘Sold’ tab on that particular website and look for the most recent house sales in your street or neighbourhood. This will help you to get some idea of the value of the market at the moment. Always remember, the valuation is based upon a fast sale not a sophisticated real estate agent’s marketing project. Understanding this step is essential, at Bankruptcy Experts Newcastle we can provide 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 have $300,000 equity in your home 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 means to pay your debt consequently they will more than likely sell your house 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 provided you the money for your home is making a great 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 decides that there is enough equity in your house to liquidate it, they will force you and the bank to sell your house.

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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 call us at Bankruptcy Experts Newcastle 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 favourable outcome for you.

When we have examined your needs, we can create an action plan to help advise to you the very best strategy. From this point, you can examine your alternatives and choose where you go from there.

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Bankruptcy and Employment

Will My Employer
Be Advised?

Normally, 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 difference between presently 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. As an example, it is difficult to get into the Defence Forces as an existing bankrupt, but they do not terminate your job if you become bankrupt when you are currently employed by them.

Each professional body has its own guidelines, and this differs from state to state. Our advice is to speak directly to your industry-specific experts, who will understand exactly how your unique situation works in NSW. This is well worth doing before moving forward with your bankruptcy, as it may be an important factor in your decision. Take a look at the chart below for a list of some occupations where seeking further, industry-related guidance 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 Newcastle 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 New South Wales there is no restriction on how much you can earn when you are bankrupt. Before filing for bankruptcy, however, it is important to consider your salary and ensure bankruptcy is the best option for you before proceeding. Find out how much you can make before you need 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 worried about this just call us at Bankruptcy Experts Newcastle 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?

In most cases in New South Wales, your partner is seen as a completely 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 get further advice. Call Bankruptcy Experts Newcastle 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 anybody, of any age, who lives 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 need 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 individually. If you have kids refer to the income thresholds in the chart above. If you have additional questions call us at Bankruptcy Experts Newcastle on 1300 795 575.

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