Debt is something that an alarmingly large amount of people to get into a worsening cycle of, trying their best to keep on top of finances only to find we’re way over our heads. The truth is, most people are in debt, whether it’s because of the car you bought, the short term loan you took to go on that dream holiday, or even just a house mortgage. Most of these kinds of debt we make for ourselves based on our current financial situation and with trust that our income will at least remain the same until we’ve paid off what we owe.
However, some of us are often tempted by credit cards and the low interest they can carry as a means to attract your business. Maybe you even completely maxed out some store cards, or lost a fair portion of your savings on an investment or a gamble that you really believed would pay off.
Before you know it, all you can afford is to pay the minimum interest payment requirements to a multitude of companies you’ve borrowed money from. And then, your income – just at the time when you least needed it – takes a nose dive, and those payments you owe are simply too much for you to afford. Now, you’re missing payments, and that excellent credit rating you use to possess is slipping through your fingers, making many aspects of life much more difficult. You’ve even considered getting another loan to pay off your existing debt, but that would cost you more in the long run, possibly, and it’s something you’d rather not do, even if it could make your financial situation less desperate.
A final option is bankruptcy. A word that carries a bad stigma and it’s the least thing you ever imagined you’d need to claim. However, there is one more option – and that option is filing for a debt agreement. Introduced under to Bankruptcy Act in 1966, Australia, this may be an option you might also want to consider. Below are some extremely brief differences between bankruptcy and debt agreement. You can enquire with FFD debt agreement for a more detailed explanation of what’s best for you.
Bankruptcy
- You may not have to pay creditors if your assets and income are below a certain threshold.
- You don’t need to be approved by creditors to attempt to attain bankruptcy status.
- Some of your assets and property has the potential to be ceased to pay creditors.
- You’ll need to get permission from the relevant body to travel overseas.
- You may face employment restrictions.
Debt Agreement
- Interest on your debt could be frozen if accepted into a debt agreement.
- Repayments will be based on your financial situation, making them more manageable.
- It could have a negative effect on your credit rating for five years.
- Your creditors can choose not to accept your proposal.
This article is to highlight that if you’re in a difficult financial position, you do have more than one option. Browse reputable companies for honest advice, such as through FFD debt agreement.
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