There are two types of bankruptcy that may appear on your credit file, they are:
1. Voluntary (debtor’s petition)
Anyone who owes a debt of any amount to another person can enter bankruptcy voluntarily by filing a debtor’s petition with the Official Receiver at Australian Financial Security Authority. AFSA provides a ‘one stop service’ where forms can be completed, lodged and general information provided on bankruptcy and the alternatives. When the petition is accepted, the debtor is automatically declared bankrupt. No fees are payable to lodge a Debtor’s Petition.
2. Involuntary (creditor’s petition)
A creditor may make a debtor bankrupt only if the amount owed to that creditor exceeds $5000 following a Court judgment. A combination of creditors to whom debts totaling $5000 or more are owed may join together to make the debtor bankrupt.
There is also an alternative to bankruptcy that may appear on your credit file:
- A Part IX Debt Agreement is a legally binding agreement between a debtor and their creditors. Entering into a Debt Agreement is an act of bankruptcy, but is not the same as being made bankrupt. With the assistance of a Debt Agreement administrator, a proposal needs to be submitted to AFSA for approval before being put to a person’s creditors. A debtor must be insolvent (unable to pay debts as and when they fall due) in order to put forward a proposal to enter into a Debt Agreement.
Can we assist to remove any of these bankruptcy listings from your credit file?
There is limited assistance we can offer you if you have a bankruptcy listing.
If you have entered bankruptcy voluntarily, we may be able to assist in limited circumstances, depending on your answers to these questions:
- How many creditors were involved in the bankruptcy?
- Was one of these creditors a debt collection company? (for example, Lion, Pioneer, Baycorp, ACM, etc)
- If so, were you served with a Notice of Assignment advising you that the debt collector had taken over the debt?
If you have entered bankruptcy involuntarily, unfortunately we cannot assist you.
We also cannot assist you with your Part IX debt agreement listing.
For confidential advice and assistance please call Merrilyn Mansfield on 1300 306 811 or 0425 322 972.