Going Bankrupt in Australia 2016 - What you should know long before you declare bankruptcy
If you are overwhelmed by debt and you are looking into Going Bankrupt, there are 4 consequences you must consider first
Credit Rating
When it comes to Going Bankrupt in Australia, the process will normally last for 3 years in many cases and for that 3 years your credit file will be branded with a 'bankruptcy' on it, this basically means you will not have the opportunity to borrow money. By the end of your 3 years you will be a 'discharged bankrupt' what this suggests is that your credit file will no longer say you are at the moment bankrupt it should say you were bankrupt. What this means is that only specific lenders will permit you to borrow money for things like houses and cars at a slightly increased interest rate, but if your income is ok then you are going to be okay. If you simply Google Search 'Loans to discharged bankrupts' you will find plenty of lenders out there. The reason is straightforward, you are actually a good risk considering that you have no other debts anywhere. Your credit file will be marked with a 'discharged bankrupt' from the day your bankruptcy is finalised for another 2 years. So in other words your credit rating will be back to squeaky clean again after 5 years like nothing happened. If you have already had someone default your credit file it also stays on your credit file for 5 years and the implications for loaning money are just as dire with a default-- and it is for this reason you will need to speak to someone about Going Bankrupt.
Most of the time by the time someone files for bankruptcy in Australia their credit file is so ruined that the impact bankruptcy has on their credit rating is of no genuine implication they cannot borrow money in any case. If you are looking at bankruptcy and you are would like to know more give us a call here at Bankruptcy Experts on 1300 795 575, or visit: www.bankruptcyexpertsAustralia.com.au
Asset Loss
When people come to me concerning Going Bankrupt I'm often asked 'what assets will I lose when I file for bankruptcy?' It is probably easier to consider it this way: Your household belongings are not going to be impacted. The assets that you will sacrifice will be big things like cars, boats, houses etc. You can have a car to the value of $7,500 in equity. So to put it simply if you have a $20,000 car with a $20,000 car loan attached you can keep it due to the fact that its got no equity in it. So its not the total worth that makes a difference in this case its the equity or the distinction between the loan and the price of the car. But I don't want to talk too much more about assets because it is a complicated area of Going Bankrupt, if you have questions about assets because you are looking at Going Bankrupt give us a call here at Bankruptcy Experts on 1300 795 575, or visit: www.bankruptcyexpertsAustralia.com.au
There is plenty of confusing information around about assets and bankruptcy, so ensure you get the right guidance. Your house may also be of concern for you, because you may be able to keep your house and still file for bankruptcy, once more call us if you would like to know more about houses and Going Bankrupt in Australia.
Income Loss
For the 3 years you are bankrupt you may be required to provide some of your income back toward your debt. (see table below).
There are some points to consider with this aspect of your income though, firstly if you pay any child support that comes out of your income first off, so in other words your net income will be worked out once you pay your tax and then child support, what's leftover is your net income.
If you are a couple and you both declare bankruptcy these figures are based upon individual incomes not combined so with no dependents each partner can earn $1,010.45 in the hand weekly.
If one partner in a relationship is bankrupt the non bankrupt partner can gain any income because it's not factored into the equation.
If you are self employed or your income is irregular the figure will be determined yearly and not weekly. If you earn over the threshold amount weekly then you will be required to add weekly from your pay.
But this is actually important when it concerns Going Bankrupt because If you do not contribute from your salary like you are expected to, the consequences are serious, your bankruptcy may be expanded until you do re-pay the required amount.
Overseas Travel
The bottom line with bankruptcy and overseas travel is basic. If you get the right advice and file for bankruptcy properly in the first place, then you will not have a concern travelling overseas as often as you want while you are bankrupt.
The process is a straightforward online application you pay $150 and you are on your way.
If you are worried about any of these problems In Going Bankrupt about Assets, Income, Credit Rating, and travel limitations call us here at Bankruptcy Experts on 1300 795 575, or visit: www.bankruptcyexperts.com.au
