Are you thinking of Bankruptcy?

For most people the thought of bankruptcy is devastating enough having it become a reality is very painful and comes accompanied with an overwhelming sense of failure. If you are feeling trapped and like you have no options, because you are crippled by debts you don’t have to be. Can you imagine a future free from creditors phone calls and looking forward to the mail again. There are a few things you must know before you make that very difficult decision. Firstly, the sooner you act the more options you will have. Secondly, you may not have to declare bankruptcy, you do have options. In most cases when bankruptcy is the best step forward, it may only take a few days before you are debt free. There are always going to be other concerns, but Bankruptcy Experts is here to help make everything clear for you. For more information send us your details or call 1300 818 575.

Is Bankruptcy Right for me

Is bankruptcy my only option?

No! There are several options available to you. This will give you a brief overview of the pros and cons of each of the options.

Avoid creditors – you have probably already had a taste of how this is really not an option. The obvious downside to this is that the problem is never resolved; you live with the burden until the debt is paid. Creditors generally have a vast number of resources available to them one of which is debt collection agencies to find you and re-coop their money, this is a multi-million dollar industry; they don’t get paid until they get you to pay.

There are informal ways around this though; arrangements can be made. Some of these options include refinancing, advice from financial planners, consolidation of loans, and informal agreements. Don’t forget, they are human too, and they may surprise you with these alternatives. But don’t forget, it is best not to step forward without financial advice.


5 Questions you must answer before you declare yourself bankrupt.


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, being able to answer these questions is vital. Once you have all this information then you will know exactly what will happen to your business and assets should you choose to file for bankruptcy. Feel free to download our eBook for free and educate yourself today. Or, if your questions are more complex, call us at Bankruptcy Experts directly on 1300 795 575.

bankruptcy expert ebook

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Personal Insolvency Agreements

Pros – Personal Insolvency

You pay a reduced amount. The percentage of cents to the dollar depends on the circumstances.

  • avoid bankruptcy;
  • avoid expensive legal costs and court proceedings;
  • possibly limit liability to make income contributions;
  • You pay a reduced amount. The percentage of cents to the dollar depends on the circumstances
  • it can be a very a quick process, essentially once the agreed amount is paid its all done.
  • avoid partnership dissolution

What’s in it for the creditor?

  • The debtors assets are independently controlled;
  • Lower legal costs associated with court proceedings;
  • Generally the creditor receives more money than under bankruptcy;
  • The creditor generally gets their money is faster than bankruptcy

Downside to Personal Insolvency Agreements

You pay a reduced amount. The percentage of cents to the dollar depends on the circumstances.

  • You are not free until you have fully complied with the PIA’s obligations
  • It may take many years to settle the debt
  • It still affects your credit rating for up to 5 years or more depending on the circumstances.
  • You cannot be a company director until the terms of the PIA have been complied with
  • You are required to meet with your creditor face to face held by the trustee
  • Your details will be published in a local paper such as; name, address, occupation & business name.


Personal Insolvency, or “bankruptcy”, can feel overwhelming, often our clients say they feel trapped with no options left. The reality is bankruptcy is a legal and simple way to free yourself from crippling debt and start again!

What does
Bankruptcy mean to me

Firstly, the question is, do you need to declare yourself bankrupt? Just because someone is chasing you for debts, whether they be business or personal, it does not necessarily mean you will ultimately end up in bankruptcy or even need to consider it. If your not sure just call us on 1300 818 575.

The reality is, bankruptcy can bring enormous peace of mind, it will cancels components of your debt, see below for comprehensive list and discussion, the debt collectors calls will stop, you’ll be able to make a fresh start again, and before you know it you will sleep well again.


If I declare bankrupt can I keep my house?

The future of Malaysian Airlines is unclear after another very public and devastating tragedy struck the airline last week when flight MH17, was shot down over eastern Ukraine last week. The airline was already struggling prior to Flight MH370 disappeared back in March. The company is in talks with a number of different parties including the unions to try and prevent bankruptcy. That combined with ticket refunds and reduced ticket pricing to try and stay solvent are some of the strategies that the airline is doing to pay its bills, its difficult to be optimistic for the airlines future, it needs a serious equity injection if it is going to survive.

If this is one of your concerns call us and we can work through this with you. Each case is dealt with according to a variety of factors, but often the answer is yes! Simply call 1300 795 575


Is my bankruptcy made public ?


There is still a stigma about bankruptcy we understand this concern in fact we do our best to reduce any publicity. While the bankruptcy is recorded, this will only be of minor record and doesn’t affect that majority of those who turn to bankruptcy. While the process can be complicated, we can help make the process smoother and simpler for you. It enables ordinary people to conquer their debt and move on with their lives.


What debts does bankruptcy remove?

It’s probably easier to say what bankruptcy won’t cancel. There’s a couple of debts that bankruptcy won’t cancel, like Centrelink, child support, HECS and a court imposed fine. Other than that it will cancel things like your credit cards, store cards, GST and tax, unsecured personal loans, etc. In reality there are too many things to list if you have a particular debt you are worried about just give us a call on 1300 795 575.


Why do some companies say Debt Agreements or Personal Insolvency Agreements
are the way to go?

You will find as you navigate your way through all of the available information that is out there, that every company tends to give (biased) advice according to the service that they offer. For example Debt Agreement Companies ridicule bankruptcy companies. That’s probably because there are good profits to be made by the promoters and administrators if you do so, as you keep paying them for years and years and years, money that as a bankrupt you could be saving. And so it goes with much of the financial services industry.

Will I lose my car if I go Bankrupt?

Often no, Bankrupts rarely lose their cars because they’ve gone bankrupt.

For the most part, for bankruptcy purposes, cars are rarely worth enough (wholesale) for a bankruptcy trustee to claim them.

Of course this is conditional and we can let you know if yours is safe. Call us on 1300 795 575


Can I travel Overseas?

Yes. This is rarely an issue. The bankruptcy trustee will assess each case based on a number of factors before providing permission. Often there is no issue, and it is just some forms to fill in and in a few cases some hoops to jump through, but overwhelmingly permission normally is granted. This law is predominantly there so high flyers don’t skip the country. In some cases the trustee will request your passport, don’t worry about it you can request it back when you need to travel

As always, we can advise you based on your own circumstances. Call us on 1300 795 575.


Can I get out of my bankruptcy or have it annulled ?

Yes. There are provisions within the Bankruptcy Act that enable bankrupt to have their bankruptcy annulled through a Section 73 proposal.

The repercussions of creditor’s claims can often result in bankruptcy, regardless of whether or not it was the individual’s choice to enter bankruptcy, or if it was filed by a creditor. However, bankruptcy is far from the end of the world for the person who undergoes bankruptcy.
We can help you annul your bankruptcy which will essentially have the same effect as if the bankruptcy had never occurred.

Rather than following the natural course of bankruptcy over 3 years or more, which would result in a catastrophic credit record and a painful and arduous procedure, a Section 73 proposal is an approach where “everybody wins”.

s73 involves a proposal being put forward and accepted by creditors. While some debts will still need to be repaid (e.g. child support, HECS, debts incurred after bankruptcy).
There will be a number of terms to be adhered to, and other conditions, however, for the most part This gives you the opportunity to have a ‘clean slate’, free from all debts accrued at the time of bankruptcy.

Call us today on 1300 818 575 to get some advice on this issue. We exercise the best possible course of action for you to get back up and running, eliminating residual effects and hindrances of past financial situations to give you the best possible result. Having experience and skills specialising in Section 73 proposals, we can combine this with our proven strategies and methods to bring you through bankruptcy unscathed, ready to start over.

Bankruptcy needn’t be the end of the world, indeed it can be the springboard for a whole new start! Through the use of our proven strategies and with our expert knowledge we can utilise Section 73 of the Bankruptcy Act to turn years of bankruptcy to months, and through an annulment it be as if the bankruptcy never occurred in the first place.

Personal Bankruptcy

How long will the process take to file for bankruptcy?

We can have it all done for you in a few days. We will provide you with a clear path to help you prepare for this step. It’s important to be organised and prepared for bankruptcy, doing it too soon without all the information can be hazardous, just give us a call on 1300 818 575. If you choose to go bankrupt using one of our services, you’ll virtually be debt free at the end of the bankruptcy. Taking into account the conditions discussed here, Quite often you’ll be completely and absolutely debt free. You can start again.

Personal Bankruptcy

Will bankruptcy affect my income?

Will my bankruptcy affect my partner’s income or assets ?

No. From a legal standpoint your partner or family member is a completely separate legal entity. However, sometimes people out of desperation do questionable things with cash or assets the week before they file for bankruptcy like selling the house to their partner for $250 dollars. This sort of activity will just raise red flags and then your partner will be impacted by your bankruptcy. Correct advice is the key here, you’ll need the right advice so you can sleep at night. Call us about your situation if you have questions on 1300 795 575.


What if I’m already in a Debt Agreement can I get out of it?

Yes. If you’re already in a debt agreement and now find it overwhelming and you want out, then that’s easy just give us a call and we can help you free yourself from it. We’ll happily do the paperwork for you just call 1300 795 575.


Is there a limit on what I can earn for the 3 years I’m bankrupt? ?

No. There is plenty of misinformation in relation to what you can earn while you are bankrupt. During the 3 years of your bankruptcy you can continue to earn as much as you like.


Is income affected my by bankruptcy?

If your take home pay is $1031.8 per week or less then the answer is no. If for the 3 years you are bankrupt you don’t earn more than $1031.8 per week or $53,653.60 per year in the hand or net then you won’t contribute to the debts you incurred prior to bankruptcy. There is consideration for various types of ‘take home pay’, and any dependants will change this figure. However, in most cases, once the 3 year period is complete all of your debts are wiped.


What is your money worth in 2016?

Developments are coming to the world of bankruptcy, if you need to know what is happening, then pay attention here. Since March 2016 there has already been updates to the Income Threshold Amounts. This signifies that there are changes to what money you can retain when bankrupt, this is basically your net income right after tax and child support (if applicable) is deducted. If you’re in business whilst bankrupt, then of course it’s also after net (after tax) business expenditures, which is normally calculated annually.

Your net income may be corrected to consider things like salary sacrifice and high superannuation payments etc. Your net income can also allow added unusual costs incurred as a result of being employed, for instance if you incur an unusually high amount of travel expenses to get to and from your job this can sometimes also be taken into consideration. Your bankruptcy trustee needs to establish your real net income according to the bankruptcy rules.

The income threshold totals are also per person, and are changed by the Government every March and September to allow the movements in the cost of living.

As of March 2016 the income thresholds are as follows;

With no dependents your net income can be $54,518.10 net per annum, i.e. that’s an average of $1,048.25 net every week take home pay. This is your spending money. It’s all yours. It’s what you can hold, and so anything over that amount is partition 50/50 with your bankruptcy trustee to be paid to your creditors.

With 1 dependent your net income can be $64,331.36 net per annum, i.e. approximately $1,237.14 net every week take home pay.

With 2 dependents your net income can be $69,237.99 net per annum, i.e. around $1,331.49 net each week take home pay.

With 3 dependents your net income can be $71,963.89 net per annum, i.e. an average of $1,383.92 net every week take home pay.

With 4 dependents your net income can be $73,054.25 net per annum, i.e. approximately $1,404.88 net each week take home pay.

With greater than 4 dependents your net income can be $74,144.62 net per annum, i.e. an average of $1,425.85 net every week take home pay.

If you believe your case is more complicated, then simply get professional advice. If you have a particular income question just call us here at Fresh Start Solutions on 1300 818 575.


What if my spouse/partner and I both need to go bankrupt?

If both you and your spouse/partner declare bankruptcy, then the same income rules will apply as to both of you, for instance considering the table above, with 0 dependants, both can each earn $1031.8 per week


Can I continue to be in business or self employed as a bankrupt?

Yes. If you want to be in business for yourself whilst bankrupt, you must trade in your own name, Mike Jones, or Mike Jones Plumbing. And you must disclose bankruptcy when seeking credit above a certain threshold, which is currently $5,387.

business affected bankruptcy

Can my spouse/partner be considered a dependant?

A dependent can be any person, 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.


What If I am the director of a Company?

For the 3 years you are bankrupt you cannot be the director of a company, so if you had a business that traded through a company you will need to go on the ASIC website and resign as a director. However it’s important to understand you can still run the exact same business just no longer through a company structure just as a sole trader. There are some technicalities here be careful, if you have questions just give us a call and we will walk you through it. Bankruptcy does not have to mean the end of your business.

Will bankruptcy affect what type of job I do?

A dependent can be any person, 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.

Bankruptcy in Australia – Am I going to lose my job if I go bankrupt?

Imagine a future with more freedom.

Now that you’ve seen how bankruptcy affects your income you may be able to start to see that the main thing about this is not to let bankruptcy slow you down or stop you. The great plus in all of this is that by getting the protection of “the umbrella of bankruptcy” the awful harassment and assaults and straight out lies from some of the debt collectors, and your resulting worry and stress and loss of sleep, will cease.

Basically speaking, where I’m coming from in this is that if you’ve tried the best you can to pay your debts, but for whatever reason you’ve now had enough, then the relief that can be offered to you through what I call “the umbrella of bankruptcy” may be of some help.

The stigma of bankruptcy is very much an imaginary thing. You can mostly forget, it’s played up a lot by those trying to make you feel uncomfortable, whether it be a family member or a debt collector. From where you’re at right now, bankruptcy could have a lot of very real benefits.

Don’t feel uncomfortable about making contact. Call now for a confidential no obligation chat about your circumstances, remember bankruptcy is about getting you back a quality of life. Call Now 1300 818 575


How is my business income assessed?

The dependant can earn $3,411 per year before they cease to be eligible as a dependant. If a dependant earns a bit more than $3,411 per year, your bankruptcy trustee will work out your pro rata dependant amount claim.


Bankruptcy & the Family Home

How the Bankruptcy Act applies to a bankrupt’s family home is often misunderstood. The loss of the bankrupt’s family home is usually felt more intensely than the loss of any other asset. Understandably, many bankrupts know that the loss of the home will disrupt the family unit, not only affecting the bankrupt but also their children and solvent partners.

Because of these factors, trustees in bankruptcy must approach the realization of a bankrupt’s interest in a family home with some tact and understanding, while protecting the rights and interests of creditors.

Is the family home

No. The family home is not a protected asset under the Bankruptcy Act. If there is equity in the property after paying out any proper mortgage and selling costs, the trustee is obliged to realize the property.

family home protected
joint ownership

What about joint ownership?

The realization process is relatively straightforward when the bankrupt is the only owner of the home, or all of the owners are bankrupt. However, often the bankrupt and his or her non-bankrupt spouse will own the family home together as “joint tenants”. But even if the family home is jointly owned by the bankrupt and a solvent (non bankrupt) co-owner, the trustee can still insist on the bankrupt’s share of the equity being realized. The options available to achieve this are discussed below.

joint ownership

How is the equity in a
property determined?

The trustee will have the property valued. Secured debts are deducted from that value and the bankrupt’s share of the equity is determined by simple mathematics.

bankruptcy determined equity143

What if there is no equity in the property?

Sometimes there is no equity in a property when it vests in the trustee, meaning that the debts secured against the property are greater than the current value of the property. In some cases the mortgagees will exercise their rights and sell the property.

But sometimes the mortgages will take no action and the bankrupt and maybe other parties will continue to service that loan. Also, overtime, the value of the property may increase. The property vests in the trustee at the time of bankruptcy and remains vested even where there is no equity and even if the trustee takes no immediate action to sell the property. The property will remain vested in the trustee even after the bankrupt has been discharged from bankruptcy.

The trustee will generally review the equity position of the property from time to time. They are able to realise any equity generated after the date of bankruptcy. This is the case even if that equity has been generated by the continued payment of the mortgage by the bankrupt or the other owner. Mortgage payments attributed to the bankrupt’s share are deemed to be rental payments for the use and occupation of the property during that time.

What happens to joint tenancies on the bankruptcy of one or more owners?

A joint tenancy is automatically severed upon the bankruptcy of any one of the joint tenants – at least as far as it relates to the ownership interest of the bankrupt.

This occurs due to the “involuntary alienation” or severing of the fundamental legal rights of the parties necessary to create a joint tenancy. This practice is long established having been mentioned in the 1862 case of Paten v Cribb. The trigger to this alienation of legal rights is the vesting of the property in the trustee and that occurs at the commencement of the bankruptcy.

After the severing of the joint tenancy, those interests in the property are held as a ‘tenants in common’. This is important if a bankrupt dies after their bankruptcy. If the joint tenancy had not been severed, the bankrupt’s share of the property (and the equity attached to that share) would automatically vest in the co-owner upon the death of the bankrupt, and the value would be lost to the estate.

joint ownership

How are properties realized?

Where the trustee is the only owner, they can put the property for sale. Where there is a co-owner, the trustee will usually take the following steps:

(1) give the co-owner the opportunity to buy the estate’s interest in the property;

(2) if that is not possible, see whether the co-owner will join with the trustee in cooperatively marketing the property on agreed terms; or finally

(3) if an agreement on selling the property cannot be reached, the trustee can ask the court to appoint a ‘Statutory Trustee for Sale’ over the co-owner’s interest to force a sale of the property.

The appointment of a statutory trustee compels the sale of the home, notwithstanding that the co-owner is solvent and has not contributed to the bankruptcy in any way. Although the court will often attempt to soften the effect of such an order by allowing the spouse time to relocate, the ultimate effect is that the property will be sold.

joint ownership

What about mortgages?

The vast majority of family homes are subject to a mortgage. The mortgage may be enforced during the bankruptcy, possible even when the mortgage payments are up to date as the bankruptcy itself may be a default that the mortgagee. Although mortgagees have the power to sell the bankrupt’s home, in most cases they will leave the task to the trustee.


What is entering transmission

The sale process usually begins with the trustee ‘entering transmission’. This is the legal process to have the trustee’s name placed on the certificate of title in place of the bankrupt’s. This is necessary so that the trustee can execute a sale contract and transfer forms when selling the property.

Usually the trustee will only enter transmission if he is satisfied that there is equity in the property. If there is doubt about the final outcome, the trustee may initially lodge a caveat over the title to protect the estate’s interests for the short term, giving them some time to determine what to do with the property.

What about getting vacant possession?

The trustee will normally be required to provide vacant possession when selling a property so it will be necessary for the bankrupt to vacate the property before settlement. The trustee usually does not expect a bankrupt to vacate the premises immediately on bankruptcy and will, in normal circumstances, provide a few weeks for the alternative arrangements to be made.

In some cases the trustee may allow the bankrupt to stay in residence during the selling period provided the bankrupt assists that process, contributes a fair rent and maintains the property, and when the trustee is satisfied that the bankrupt’s will continue to cooperate with him or her.

For Closure

How are the proceeds of sale distributed?

If the property is wholly owned by the bankrupt, the estate will get the entire surplus of the sale after any mortgagee and selling costs are paid. If the property is co-owned, the trustee will share the surplus with the solvent owner on the basis of the legal entitlement as shown on the title deed.

Although the title to a property may be held equally, occasions will arise where uneven contributions have been made towards the acquisition or development of the property. This may lead to one party holding the property for the other party in a constructive or resultant trust – and possibly alter the distribution. The sharing of equity may also be altered under the doctrine of exoneration if loans secured on the property were used by one party and not the other.

For Closure

Is there a timeframe for the sale of the property?

Trustees will generally sell property in a timely fashion. Section 129AA of the Bankruptcy Act requires trustees to realize property within a period ending six years after the discharge of bankrupt. This generally allows 9 years to arrange sales. If the trustee does not do so, the property could revest in the discharged bankrupt.

The six year rule only applies to property disclosed to the trustee. If the property is not disclosed in the bankrupt’s Statement of Affairs or as after-acquired property, the trustee will have 20 years to deal with the property.


When does the Doctrine of Exoneration apply?

The property may be encumbered by a mortgage that secures a loan to the sole benefit of one owner, even though all owners have agreed to the mortgage. The doctrine says that the person who received the benefit of the loan should have the first obligation to repay the loan – and the co-owner should only be considered a surety (guarantor) and their share should only be used to meet any shortfall.

A simple example of the doctrine would be a family home worth $400,000 owned by the bankrupt and his solvent spouse. Prior to bankruptcy they agreed to the bank taking a mortgage over their property to support an advance of $150,000 to the bankrupt’s business. On a sale of the property $250,000 would be available for distribution to the owners ($400,000 sale price less the mortgage of $150,000). Because each owner had an equal share in the legal title to the property it might be thought that they should each receive $125,000.

However the doctrine of exoneration may require that the amount due under the mortgage should be deducted from the bankrupt’s equity so that the following equitable distribution would apply:

Bankrupt’s share = $200,000 less $150,000 = $50,000
Spouse’s share = $200,000

The principle of the doctrine of exoneration is not applied without a full review by the trustee who must find compelling evidence that it should apply.

War Service Homes

A bankrupt or a debtor under Part X of the Bankruptcy Act cannot have a war service home taken from them, except in extraordinary circumstances. This arises from the provisions of the Defense Service Homes Act which state:

For Closure


Bankruptcy of purchaser or borrower

(1) Except with the approval of the Secretary, the estate or interest of a purchaser or borrower in any land, land and dwelling-house or right of residence in a retirement village that is the subject of a contract of sale, or of a mortgage or other security securing a Corporation advance or a subsidised advance:

(a) shall not be taken from the purchaser or borrower under the Bankruptcy Act 1966; and

(b) shall not be sold in satisfaction of a judgment debt, otherwise than by the Bank or another mortgage in the exercise of powers under a contract of sale, or a mortgage or other security.

(2) Where a husband and wife are joint purchasers or borrowers in relation to land, land and a dwelling-house or a right or residence in a retirement village, the Secretary may give an approval under subsection (10) in relation to the estate or interest of both of them if either of them becomes bankrupt or incurs a judgment debt.

Although the secretary of the department has discretion to allow a trustee to sell up the bankrupt’s property, in reality this discretion is very seldom applied. In our experience the secretary will not exercise his discretion even where the bankrupt has incurred very substantial business debts.

There can be no doubt that some bankrupts have taken business risks which would otherwise have been avoided in the knowledge that they would not lose their home. This is inequitable as far as creditors are concerned, but that currently is the law.

For Closure

How much will it cost?

Our initial consultation is free. Depending what we need to do for you, it can cost as little as $495.

If you decide that you’d like to talk to somebody about going bankrupt, or cancelling an existing Debt Agreement Proposal or maybe your business is in trouble and you’d perhaps like to use one of my services to help you with all of the paperwork, just call 1300 818 575