In a dire situation - Mining town collapse

My understanding is yes you just fill out the forms and apply at any time, from what I just read there's no fee and your creditors (the bank) will be informed as part of the process.

Apply for bankruptcy | Australian Financial Security Authority

The three years starts the day you apply, so it seems like if it's going to happen, it's best to have it happen ASAP.

Bankruptcy | Consequences of Bankruptcy

As others said earlier, though, it's probably a good idea to get expert legal advice prior to doing this.

 

anytime

 

As others have said, anytime.

Some may consider it immoral but if you're going down for a penny you may as well go down for a pound.

Stop paying all your bills and stuff the money in your mattress. Once they all cut you off declare bankruptcy.

 

It is expensive, and you can get the help you need for a lot less. I would recommend speaking to experts on this to get a real solution in place with some strategy around your approach. An expert can do this for you.
Your dads $50k is very likely to help you with the right strategy in place.

Without a strategy it won't avoid bankruptcy.

 

A financial counsellor is not the right person to assist in this situation. You need other expertise and really I think you are calling it way too early. You could very likely avoid bankruptcy with the right people assisting you.

 

Just beware of the so-called experts are aren't really experts. I have seen one case where someone was give a so-called strategy that was legally defective and their fee was $50k for basically doing nothing but talking to creditors. You could do this yourself or get someone legally qualified to help.

 

Thanks for all the comments..

I thought I'd post an update on the situation. I managed to find a buyer and the house settled a month ago. Ended up with a shortfall of $430,000. The LMI paid the bank (Not sure if it was the full amount or partial) so I'm just waiting for the LMI to make contact.

I've had some legal advice on the consequences of bankruptcy so If it comes to that I have all the information

 

I would say the same as any other bankruptcy situation. Best way to find out is negotiate hard with the bank and see what they can accommodate?

Stays on your credit file for 5 years and yes most lenders ask if you have been a previous bankrupt.

 

Glad you found a buyer.

 

I declared bankrupt about 5.5 years ago due to a divorce and too many debts to cut a long story short. Fortunately I now own a great business and earning a great income now. It is a major relief to clear all debts but it does put you back. Income is monitored as well and anything over a certain amount you pay half to the creditors. It will be hard for you to obtain a lon at first but it's like being in the sin bin. Good luck if you need to know anything contact me.

 

So basically you have to pay your creditors, dependent on the debt could take xx years???

 

Only if you earn over a certain amount within the three years, not after you are discharged. The discharge can be extended I believe if you get court out not playing by the rules within the three years?

I have a friend who filed bankrupt, was discharged in three and had no problems borrowing for a PPOR seven years after filing. No higher interest rates, no dramas at all. He is investing in property now with no issues relating to the bankruptcy.

 

Kudos to you for making a decision and moving forward. Tough call. Well done.

 

You are talking about debt negotiators? I've spoken to a few and can't see how they are worth the money. Yes they will negotiate for me but I can do that myself - I only have a limited amount to offer so no mater who negotiates it will be the same outcome.

 

@styereye

Just reading the thread, what was the outcome?

 

OP was online 2 weeks ago, so at least they havent disappeared

 

I settled the debt with the LMI. They accepted 5% of the shortfall. Not sure how it will affect me in the future but have been assured it wouldn't be added to our credit file. Very happy with the outcome and once again appreciate all the help I've received on this.

 

Wow. Great stuff.

 

If anyone is going through similar just a heads up on debt negotiators - do not use them. Everything can be done by yourself. I spoke to one, they said they were looking to offer 10% and doing it myself I ended up with 5%.

 

Awesome work, well done