A debt agreement is a binding agreement under Part IX of the Bankruptcy Act 1966 (Cth)) between a debtor and their creditors where creditors agree to accept a sum of money which the debtor can afford. Proposing a debt agreement is an act of bankruptcy.
Debt agreements have:
- extra protection for debtors not offered by private or informal arrangements
- eligibility requirements that you must meet before you can proceed
- the same rate of payment to all creditors
A debt agreement is an option to assist debtors with unmanageable debt and is an alternative to bankruptcy. Debtors are released from most of their debts when they complete all payments and obligations under the agreement.
Our team of experienced pre insolvency lawyers can assist you with all aspects of personal insolvency.
To find out more about what we can offer, visit our areas of law pages or contact our insolvency solicitors for a consultation.