If you are considering declaring bankruptcy, you need to carefully consider your options and get legal advice before you start the bankruptcy process. Many people who are struggling with debt consider filing for bankruptcy, but you should know what it entails before making an application.
At Parke Lawyers we provide expert advice on the option of declaring yourself bankrupt. If you cannot repay your debts and you cannot seem to reach a suitable agreement with your creditors, you can voluntarily declare yourself bankrupt.
One of your creditors may also apply to the Federal Court to have you declared bankrupt. However, you need to have a total debt of more than $5000 before a creditor is allowed to file an application against you. There is no minimum amount necessary in order for you to declare yourself bankrupt.
If you want to apply for bankruptcy you have to complete a ‘Debtor’s Petition’ form, which will outline all your current debt, as well as your creditors and all their debt. If your application is granted, the period of bankruptcy will be active for three years. This may be extended if the trustee submits an application.
Once you have declared bankruptcy, a trustee will be appointed to handle your financial affairs and to try and recover enough money to repay your creditors.
What You Need to Know About Bankruptcy?
The main benefit that seems attractive to people is the fact that they won’t have to deal directly with their creditors. However, if you are bankrupt it does not exempt you from all your debt; you will also be responsible for any additional debt that you have incurred after bankruptcy took effect.
In addition to this, if you declare bankruptcy you have to surrender your passport to your trustee, and he or she must be kept informed of all payments you receive from the bank or any other financial institution as well as any changes in your marital status or your name. Deciding to declare yourself bankrupt is not always the best solution. It is always recommended that you speak to a lawyer first to consider all options available to you.For more information about declaring bankruptcy contact us.