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Those who are
in debt have limited options, with bankruptcy being one avenue to take,
although this can have serious consequences that affect a person for the rest
of their life. One satisfactory option is to come to a debt agreement with your
creditors, which is a legally binding agreement that states the amount the
person will pay over an agreed period of time. This type of agreement is called
a “Part 9 Agreement” and is not to be confused with debt consolidation, which
involves taking out a separate loan to repay the debt.
A Viable Alternative To Bankruptcy
If you are wondering what is a Part 9 debt agreement, for many people it is a credible alternative to bankruptcy, which has a
long-term effect on a person’s ability to carry out business. Bankruptcy is a
permanent solution that might not be the best option, especially if you plan to
start your own business at some point in the future.
The Advantages Of Part 9 Debt Agreement
If you manage to come to an agreement with your creditors, then all
interest is frozen from that point on, which means the debt is not growing.
With interest and other charges frozen, you can actually make progress, rather
than having to pay more and more as time passes. Once an agreement has been
reached with your creditors, providing you stick to the agreement, no further
legal action can be taken and that means no more final notices or phone calls.
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No Bad Credit Listing
Once you have completed the Part
9 agreement
successfully, there will be no record of this on your credit history, allowing
you to make a fresh start. The law states that your creditors cannot send you
letters or contact you by phone, providing you are meeting the requirements of
the agreement. Many people find the stigma of
bankruptcy seriously hampers their
life and with situations changing for the better, you do want to be impeded by
what is a permanent mark against you.
Secured Assets |
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Ability To Pay
When you enter into a Part 9 debt agreement with your creditors, the
repayments are based on what you can actually pay, rather than a figure that is
impractical. The monthly amount is something that you and your creditors agree
upon, and when you look at things from the creditor’s perspective, they do not
want a situation whereby the borrower cannot afford the repayments, and if you
would like to know more about Part 9 debt agreements, there are online
providers who can help you come to a satisfactory agreement with your
creditors, who can easily be found with an online search.
The Part 9 debt agreement is a viable alternative to bankruptcy, and while
it is not suitable for everyone, thousands of Australians have successfully
repaid their debts using this system and once that has been done, you will not
have any negative recordings on your financial history.
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