Bankruptcy in Brisbane - Choices, Choice, Choices

When it comes to Bankruptcy Brisbane, there are a great deal of options that we get given depending upon who we are, who we speak to, and just what has gone wrong. Among the most common confusion I see with Bankruptcy is when it comes to selecting between Debt Consolidation, Personal Insolvency Agreements, and Bankruptcy itself.

Should I consolidate my debts?

When it comes to Bankruptcy in Brisbane, much of the facts you receive on this subject will reflect the interests of the advice giver. That is why, if you call a debt consolidation provider, I can guarantee you they will tell you to consolidate your debts. The debt consolidation industry is a multi-billion dollar industry making money in one very simple way: charging you a fee for aiding you wrap each one of your credit card and personal loans into a single neat and tidy bundle.

I hate to tell you this but these people won't be doing it free of charge. Please don't misunderstand me: if you feel your financial problems in Brisbane might be solved by paying less interest, then go ahead and investigate the choices. Even a tiny amount of interest saved over years rapidly adds up.

More often than not I find if you read this blog you've undoubtedly attempted to consolidate your debts already and come to the following realisations similar to these:

• Your credit rating is not good, and your credit file definitely has defaults on it so not a single person will give you a loan, consolidated or otherwise,.

• By the time you work it all out, you're so far down a hole that saving a little bit of interest just won't make a lot of difference,.

• You've very likely reached the stage where you've had more than enough, you're emotionally burnt out, you can't go on another day ignoring blocked calls on your phone, ignoring the demands in the mail etc.

Personal Insolvency Agreements

So when it comes down to Bankruptcy in Brisbane, what's the big difference between a Debt Agreement and a Personal Insolvency Agreement?

Flexibility is the main thing Personal Insolvency Agreements (PIA) have in their favour. They're also administered by a registered and - might I add - regulated trustee featuring the government trustee ITSA, and not a private company that advertises on TV. Essentially this method resembles Debt Agreements (DA): The trustee has a meeting with the people you owe money to and these experts work out a deal in your place. You can offer a lump sum settlement figure or take part in a payment plan, or you can offer them assets rather than cash. This can sound fine when it comes to the troubles with Bankruptcy-- that is until you realize that one of the challenges with PIA's is that 75 % of the people you owe money to must come to an understanding the deal. If they do not, your plan is denied or ought to be renegotiated.

Generally the people you owe money prefer all their money back and also interest. Sometimes they'll settle for less than the amount you owe them - it's normally a percentage of the debt-- but allow me to stress this aspect: because of all the variables involved in the negotiation process to put together a PIA its difficult to put a figure on what the people you owe money to will actually settle for.

In many cases you'll have to pay back 100 % of the debt owed. This is not just because your creditors are greedy or have a mean streak, it's because the administrators take 20 % of whatever is decideded upon with the people you owe money to. That applies whether you use a private company for this process or ITSA, the government body setup to administer to these PIAs.

When it comes to Bankruptcy and insolvency I've come across creditors settling for less 80 % on rare occasions, but that usually only occurs with a public company going into receivership owing huge sums of money (the kind that makes the news). If you are were owed $10million and you know the people who owe you the money have a team of shrewd lawyers and some very clever frameworks in place and they offer 5 % of the debt, you might take it and be grateful. Sadly, ordinary punters like you and me in Brisbane aren't going to get that lucky!

If you would like to learn more about what to do, where to turn and what questions to ask about Bankruptcy, then feel free to call Fresh Start Solutions Brisbane on 1300 818 575, or visit our website: freshstartsolutions.com.au/bankruptcy-Brisbane