Debt Rescue

Debt Rescue debt agreement.

A large number of people will at some time experience difficulty in repaying debts. This is a fact of life. Worrying about your debts or loans will not help. You need a plan to help you get back on the road to recovery.
This is where Debt Rescue can help you. Debt Rescue can assist you in: Lowering your monthly repayments. Saving thousands of $ $ $ on interest payments. Becoming debt free quicker Putting you back on the right track Debt Rescue's consolidation services can provide debt relief, which will eliminate the stress, save you thousands of dollars in interest and have you debt free quickly so you can enjoy the experience of debt free living.

Bankruptcy & Other Insolvency Options

Our resources can assess your personal or business situation to offer a hassle–free administration process through times of difficulty.

Debt Agreements

What is a Debt Agreement (Part IX of Bankruptcy Act)

A Debt agreement is a legal and binding agreement between you and your creditors. It is also referred to as a Part IX Agreement of the Bankruptcy Act.
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 debts. Should the creditors agree it is then processed through a Government Agency known as the Insolvency Trustee Service of Australia (ITSA).

How does it work?

After completing an assessment form which details your income and all of your debts, a budget is prepared to identify any surplus. This surplus is the amount you can afford to repay to your creditors.
A proposal is then prepared and forwarded to your creditors for consideration and their vote on your proposal. If your proposal is accepted by a majority of creditors, you will now be able to commence payments to your creditors for the agreed term at a reduced rate.

Who is eligible?

There are certain guidelines and thresholds you must meet in order to be eligible for a Part IX Debt Agreement. You must not have been previously bankrupt, utilised a Debt Agreement or given an authority under Part X of the Bankruptcy Act in the last 10 years.
Your income after tax must not be more than $54,927.60 per annum, your total unsecured debts must be less than $73,236.80 and your net assets (not exempt under bankruptcy) must not be more than $73,236.80. These thresholds are updated according to CPI, figures shown here are current as at August 2006.

Benefits

The benefits of entering into a Part IX Debt 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 debt agreement the amount of your debts are 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.
Debt Rescue negotiates the terms of the proposed debt agreement. After approval you make one regular weekly repayment, Debt Rescue distributes the funds to the creditors on a regular basis according to the agreed proposal.
Not all creditors have to agree to the proposal, if the required majority of creditors agree (75% of the dollar amount of the application or a majority in number of those that actually vote) the remainder are bound by the decision to proceed with the Agreement.
Also, upon approval all garnishees must cease, you are released from most debts, and creditors cannot enforce recovery proceedings on your debts.
Consequences
Quite simply, make no mistake, if you fail to meet your obligations under the Debt 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. Your credit file will reflect a Debt Agreement application has been made.

BANKRUPTCY VERSUS PART IX DEBT AGREEMENT