Financial Crisis Recovery

DEBT AGREEMENTS

A Debt Agreement with your creditors freezes all legal action and also freezes interest. After working with your Financial Crisis Recovery Consultant to determine how much you can afford every month, a proposal is put before your creditors via correspondence, to accept this amount.

All creditors vote to support or reject the proposal. A majority in value of debt of creditors who vote is required, and the result is binding on all creditors.

A Debt Agreement is a facility to allow you to pay your debts when your life circumstances change your income level.

It comes under the Part IX Amendment to the Bankruptcy Act 1966.

FINANCIAL CRISIS RECOVERY provides a service that will guide you through the process and acts as Administrator once the Debt Agreement is in place.

We are able to give you a representation to creditors, meaning an end to those demanding letter and phone calls - We follow up with creditors to negotiate a positive vote.

A simple solution to a complex situation really does exist.

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Q. What is Debt Agreement?

A. A debt agreement is a simple method for debtors to negotiate a binding compromise with their creditors.

Q. Who is eligible?

A. A debt agreement can be proposed by a debtor who:

Has not been bankrupt, entered a debt agreement, or been given authority under Part X of the Bankruptcy Act in the last 10 years

Has an annual net income less than $61,875

Has unsecured debts less than $82,500

Has property not exempt under the Bankruptcy Act valued at less than $ 68,796

Q. What can be provided for in a debt agreement?

Periodic payment of amounts from the debtor's income to creditors

A moratorium on payment of debts

Payment of less than 100 cents in the dollar on all or any of the debtors debts

Amounts payable to creditors other than on a pro-rata basis

A transfer of property from the debtor to one or more creditors in full or part payment

The Procedure:

Stage One - Debtor must lodge with Insolvency Trustee Service of Australia the following:

A written Debt Agreement Proposal - offering payments over a period of time to be paid proportionately to all creditors

A Statement of Affairs - a 'snapshot' of your financial situation at this point in time, ie assets, liabilities, income etc

Stage Two

ITSA processes the proposal

Each creditor receives a summary of the Statement of Affairs and an explanation of the proposal

The proposal can be accepted by written response

If creditors wish to vote for/against the proposal, they must respond in writing before the end of the 'deadline date'

If accepted by a majority in value of debt of those creditors who respond, legal action is suspended and interest is frozen.

If rejected by creditors, a second proposal can be put to creditors

Effects of debt agreement . . . If accepted for processing:

All legal enforcement action is frozen for 25 working days

A sheriff must not take action to sell property during the freeze period

If accepted by creditors, they cannot:

Continue legal action to recover debt

Present or proceed with a Creditor's petition to force bankruptcy

Debtor is released from all debts, on receipt of agreed payments.

(PART IX OF THE BANKRUPTCY ACT)

NB: The rights of secured creditors are not affected by the debt agreement;

The debtor is not released from a maintenance debt.

DEBT AGREEMENTS
A Debt Agreement with your creditors freezes all legal action and also freezes interest. After working with your Financial Crisis Recovery Consultant to determine how much you can afford every month, a proposal is put before your creditors via correspondence, to accept this amount. All creditors vote to support or reject the proposal. A majority in value of debt of creditors who vote is required, and the result is binding on all creditors.	A Debt Agreement is a facility to allow you to pay your debts when your life circumstances change your income level. It comes under the Part IX Amendment to the Bankruptcy Act 1966.	FINANCIAL CRISIS RECOVERY provides a service that will guide you through the process and acts as Administrator once the Debt Agreement is in place. We are able to give you a representation to creditors, meaning an end to those demanding letter and phone calls - We follow up with creditors to negotiate a positive vote. A simple solution to a complex situation really does exist.
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
Q. What is Debt Agreement?
A. A debt agreement is a simple method for debtors to negotiate a binding compromise with their creditors.
Q. Who is eligible?
A. A debt agreement can be proposed by a debtor who: Has not been bankrupt, entered a debt agreement, or been given authority under Part X of the Bankruptcy Act in the last 10 years Has an annual net income less than $61,875 Has unsecured debts less than $82,500 Has property not exempt under the Bankruptcy Act valued at less than $ 68,796
Q. What can be provided for in a debt agreement?
Periodic payment of amounts from the debtor's income to creditors A moratorium on payment of debts Payment of less than 100 cents in the dollar on all or any of the debtors debts Amounts payable to creditors other than on a pro-rata basis A transfer of property from the debtor to one or more creditors in full or part payment

The Procedure:
Stage One - Debtor must lodge with Insolvency Trustee Service of Australia the following: A written Debt Agreement Proposal - offering payments over a period of time to be paid proportionately to all creditors A Statement of Affairs - a 'snapshot' of your financial situation at this point in time, ie assets, liabilities, income etc
Stage Two ITSA processes the proposal Each creditor receives a summary of the Statement of Affairs and an explanation of the proposal The proposal can be accepted by written response If creditors wish to vote for/against the proposal, they must respond in writing before the end of the 'deadline date' If accepted by a majority in value of debt of those creditors who respond, legal action is suspended and interest is frozen. If rejected by creditors, a second proposal can be put to creditors
Effects of debt agreement . . . If accepted for processing: All legal enforcement action is frozen for 25 working days A sheriff must not take action to sell property during the freeze period If accepted by creditors, they cannot: Continue legal action to recover debt Present or proceed with a Creditor's petition to force bankruptcy Debtor is released from all debts, on receipt of agreed payments.
(PART IX OF THE BANKRUPTCY ACT) NB: The rights of secured creditors are not affected by the debt agreement; The debtor is not released from a maintenance debt.