Going bankrupt can have serve implications for people. To avoid bankruptcy you need to explore all available options.

We can provide bankruptcy advice, forms & information to Australians and also advise people on all options as to how you can avoid bankruptcy. View our detailed pages on Bankruptcy Information or call us toll FREE for free help on 1800 98 10 70.

We may be able to help you avoid bankruptcy by providing you with the correct advice & information.

Why declare yourself bankrupt?

Most Australians only contemplate bankruptcy if they are struggling to pay debts and they can can’t make ends meet.

Bankruptcy forms

To declare yourself bankrupt you will need to complete the ITSA approved bankruptcy forms and lodge them with ITSA. Don’t pay for the forms when you can download them here at no cost!

If you are struggling to complete the forms and you need assistance call us for help. Completing the forms incorrectly could be a ground for your bankruptcy to be extended so special care needs to be taken.

Choose your Trustee

Did you know you can choose your trustee to mange your estate? We have a bankruptcy expert who is available to assist and our fee can be paid in monthly installments. If you don’t want a privately registered trustee you can simply file your bankruptcy papers with ITSA and most likely the Official Trustee at ITSA will become your trustee.

How do I avoid becoming bankrupt?

You may be able to avoid going bankrupt by following these steps:

• paying your debts in full over time; or
• entering into a formal agreement with your creditors (Debt Agreement or a Personal Insolvency Agreement).

If your creditors are threatening bankruptcy you may wish to consider to benefits of a formal arrangement, like a Debt Agreement or a Personal Insolvency Agreement.

We will assess your case free of charge and without obligation to see what type of arrangement is appropriate for you. Call us toll FREE on 1800 98 10 70.

How to set up a formal agreement?

The first step is to prepare a budget of your household income and expenditure. If you have a surplus household budget you can use this surplus to pay into your agreement.

How long will I be bankrupt?

In most cases you will be bankrupt for 3 years. In some cases this time period can be increased up to 5 years or in extreme cases 8 years. For more information click here.

What do I need to know about becoming bankrupt?

Becoming bankrupt will affect your credit rating for at least 7 years, possibly longer.

Committing an offence could lead to your bankruptcy being extended for up to 8 years. Typical offences include (but not limited to):

• concealing an asset
• failing to disclose a liability
• leaving Australia without permission
• failing to attend an interview with your trustee
• failing to pay your statutory income contributions.

Becoming bankrupt can be complicated

Going bankrupt can be complicated (particularly if own property jointly with a non-bankrupt spouse or you will earn income which exceed the income contribution thresholds). We are happy to provide advice and free bankruptcy information if you are contemplating bankruptcy, however, if you are already bankrupt we regret we cannot provide any bankruptcy help. If you are already bankrupt and you need help we ask that you call a solicitor or ITSA to resolve your concern.

We help Australians make the right decision by providing you with the right information. Get the help you can trust on our toll FREE phone line on 1800 98 10 70

Do you have a connection with Australia?

Australian Residents

Residents of Australia are free to file for bankruptcy if you have overwhelming debts which you cannot pay. The Official Receiver at ITSA has the discretion to reject a debtors’ petition if:

• it is not in the prescribed form;
• it is not accompanied by a Statement of Affairs;
• The Official Receiver is of the view that the Statement of Affair is inadequate;
• The Official Receiver is of the view that the debtor can pay their debts within a reasonable period of time; or
• The debtor doesn’t have a connection with Australia.

Non Residents

Non residents can only file for bankruptcy in Australia if they can demonstrate a connection with Australia.  To do this you will need to demonstrate:

• you have a dwelling in Australia;
• you have a business in Australia (whether in partnership or a sole trader).

If you cannot demonstrate a connection with Australia or the Official Receiver is of the view that your Statement of Affairs is inadequate or believes you can pay your debts (within a reasonable period) then your bankruptcy application may be refused.

More Information

For more information on the Official Receivers’ discretion to reject a debtors’ petition please view it here.

It is critical that you approach an organisation with the genuine expertise in bankruptcy.  You should enquire if the organisation has a Registered Trustee that practices in bankruptcy.

At Debt Free we have a private bankruptcy trustee who has a wealth of experience in practising bankruptcy, so you can be assured you will expert bankruptcy advice.

As that we can provide our advice in a timely manner, please have your details to hand when you call.  We will need details of the following:

• Your current payroll details (ie your net pay of a weekly or monthly basis)
• Up to date creditor statements for all debts (ie Citibank VISA $3,500, GE Money card $2,500, AMEX card $5,500  etc)
• Up to date balance for all secured loans, ie your house or car loans
• A list of your assets with estimated values.

If you have these details to hand we will be able to assess your situation quickly and efficiently. Alternatively, you can assess your finances yourself on-line using our debt advice model.

We are here to help people with friendly and reliable bankruptcy advice.  Our first phone call is FREE of charge and without obligation so don’t delay and call today! Our toll free line is 1800 98 10 70 and we are open 7 days a week from 9am to 5pm.

Take the right step today and get the advice you can trust. Call us toll free on 1800 98 10 70, our initial personal debt advice is FREE of charge and without obligation so you have nothing to lose. Get Debt Free today!

Bankruptcy Options

If you are considering bankruptcy, you should carefully assess your options, including your options to avoid bankruptcy.  If you file for bankruptcy without carefully exploring your options it may be too late.

What are my options?

You can file for bankruptcy voluntarily or you can be made bankrupt through the courts (ie an involuntary bankruptcy) which will initiate your bankruptcy. If you have debts which you cannot pay and you don’t have assets which can be sold to pay off debt, then we would recommend that you file for voluntary bankruptcy.

What is Voluntary Bankruptcy?

Voluntary bankruptcy is filing all of your bankruptcy forms voluntarily with ITSA.  Upon lodging these forms, ITSA will provide you with a bankruptcy number. This process is known as lodging a Debtors’ Petition.

Benefits of Voluntary Bankruptcy?

The benefits of voluntary bankruptcy is that you have the choice as to who you appoint as your Bankruptcy Trustee.  You have 2 choices, to either appoint:

• Official Trustee from ITSA
• Private Bankruptcy Trustee

If you do not nominate a Private Bankruptcy Trustee, then the Official Trustee from ITSA will automatically become your Trustee.

If you wish to appoint a Private Trustee, then you will need to obtain a consent to act from a Private Trustee. A Private Trustee will usually charge a fee to administer your bankruptcy. Debt Free has a Private Trustee available if you wish to consider the option of a private trustee. Call today to discuss your options on 1800 98 10 70.

Involuntary Bankruptcy

Involuntary Bankruptcy is the process of your creditors apply to court for a sequestration order (ie an order to have you made bankrupt).  This process is known as a Creditors’ Petition.  In this process the creditor has the option of appointing a Trustee of their choice.  This may be either the Official Trustee of ITSA or a Private Trustee.

Options to Avoid Bankruptcy

If you wish to avoid bankruptcy, consider your options which may include:

• A Debt Agreement; or a
• A Personal Insolvency Agreement.

Call us today to discuss your options FREE of charge and without obligation on 1800 98 10 70

The Insolvency Trustee Service Australia (ITSA) publish and process Bankruptcy Forms.

To become bankrupt you will need to complete and file the following documents:

• Statement of Affairs;
• Debtors Petition; and
• Prescribed Information

The bankruptcy forms can be downloaded from the ITSA web site here, FREE of charge.

Statement of Affairs

A debtors’ petition must be accompanied by a Statement of Affairs.  The Statement of Affairs must be completed accurately and truthfully, in that all personal details must be correct and you must truthfully disclose all assets and liabilities.  Failure to do so can result in your bankruptcy term can be extended.

Debtors’ Petition

A Debtors’ Petition must be completed and lodged with when filing for bankruptcy.

Prescribed Information

You will need to complete the prescribed information and lodge it together with your Statement of Affairs and Debtors’ Petition.

We can help you complete these forms for a fixed fee of $99, if you need assistance.

You also have the choice to appoint a private Registered Trustee. Debt Free has a Registered Trustee. If you don’t appoint a private Trustee, the Official Receiver at ITSA will become your Trustee.

Our friendly personal debt advisors will discuss your situation in a confidential manner. We have helped many clients around Australia with the decision regarding bankruptcy.

Lodging your Bankruptcy Application

You need to lodge your Bankruptcy Application with ITSA in your capital city.  If you want to appoint a private trustee you will need to obtain a consent to act from a Registered Trustee.  Debt Free has a Registered Trustee if you want your bankrupt estate managed by a private trustee. Alternatively ITSA publish a list of private trustees who you are free to approach.

Bankruptcy forms can be downloaded at any time.  If you need assistance in completing the forms call us toll free on 1800 98 10 70.

You should fully understand the restrictions which bankruptcy may place on your life before declaring yourself bankrupt.

If you can avoid bankruptcy by entering into a Debt Agreement or a Personal Insolvency Agreement, you may be able to avoid some of these restrictions which bankruptcy may place on your life.

How long will bankruptcy last?

In most cases bankruptcy will last 3 years, however, the 3 year time period only commences from the time you file your  Bankruptcy Statement of Affairs with ITSA.  Your bankruptcy term can also be extended by up to 5 years (so your bankruptcy term can become 8 years in some cases).

Learn how your bankruptcy term can be extended.

What other restrictions will I experience whilst bankrupt?

• You will have to surrender your passport and international travel will need to be approved in writing by your trustee
• You will have to disclose your bankruptcy status when applying for credit whilst a bankrupt
• You may need to disclose your bankruptcy status to your employer or industry association
• You may be liable to pay compulsory income contributions to your trustee
• You will not be able to own a car worth more than the limits
• You will not be able to own tools of trade worth more than the limits
• Your trustee may sell some of your personal effects if they are not protected
• Your bankruptcy trustee may seek to publicly examine you
• Your bankruptcy trustee will ask you to deliver your financial records for examination
• You will not be able to act as a company director
• You may unknowingly commit an bankruptcy offence under the Bankruptcy Act which may lead to prosecution.

Listed below are some offences described in the Bankruptcy Act:

• Failing to inform your trustee of your current address
• Failing to fully disclose all assets and liabilities in your Statement of Affairs
• Concealment of property
• Swearing a false affidavit
• Failing to attend Court when summonsed
• Refusal to provide information to your trustee
• Failing to provide truthful and straightforward answers in the course of an examination
• Disposal of an asset or creation of a charge over an asset whilst bankrupt
• Provides a false declaration whilst bankrupt
• Obtains credit over the prescribed value without disclosing your bankrupt status
• Failed to maintain proper books and records 5 years proceeding bankruptcy
• Engaged in hazardous gambling 2 years proceeding bankruptcy
• Left Australia without permission to defeat creditors
• Failed to maintain proper books and records whilst bankrupt

If your trustee becomes aware of any offence the trustee must report the offence to ITSA who may in turn refer the matter to the Director of Public Prosecution. Certain offences can carry prison sentences. Some offences can also lead to your bankruptcy being extended for up to 5 or 8 years. Click here to learn how your bankruptcy can be extended for up to 5 or 8 years.

However, before your creditors will agree, they will need to be satisfied that your circumstances allow you to qualify for a Debt Agreement.

You may qualify for a Debt Agreement if you do not have the means to repay your debts in full, ie you are insolvent.

We can help you establish if you qualify for a Debt Agreement and will put a proposal to your creditors on your behalf, ie you will not have to negotiate directly with your creditors!

If your Debt Agreement is accepted by the majority of your creditors (50% in value) then you will be protected against any further legal action your creditors may otherwise take.  For example, your creditors could not force you into bankruptcy or garnishee your wages if you are protected by a Debt Agreement.

We will help you work out precisely what you can afford to pay and then prepare a Debt Agreement Proposal to be sent to your creditors for vote.  This process can take up to 45 days after you have provided all of your details to us.  Once your creditors have agreed to your proposal you will pay the agreed contributions directly to us and we will disburse those funds (less our fees which will also be approved by your creditors) to your creditors on your behalf.  Interest on your debts will also be frozen. A  Debt Agreement will effect your credit rating.

Call today for free and impartial debt advice on our Toll Free line to see if you qualify for a Debt Agreement.

We’ll discuss your situation in a strictly confidential and empathic manner. Our debt advice professionals will discuss your needs free of charge and our advice will be provided without any obligation.

To get more detailed information on a Debt Agreement.

Remember our advice is free and without obligation,
so call us today toll free on 1800 98 10 70, you have nothing to lose!

To be eligible to propose a PIAyou must be insolvent, ie you cannot pay your debts when they fall due.

Typically we recommend a PIA if you exceed the statutory thresholds.  If you exceed any of the statutory thresholds, then you cannot enter into a Debt Agreement and you may need to consider a PIA.  The statutory thresholds are:

• Unsecured debts exceed $88,379.20; or
• Assets available in bankruptcy exceed $88,379.20; or
• Income (after tax) exceeds $66,284.40 p.a.

A PIA is a legally binding agreement with your creditors which must be approved by them.  We will usually recommend a PIA over a 3 to 5 year term.  The time period of your PIA will vary depending on your circumstances, ie your income & household expenditure and the level of debt.  We will help you formulate a proposal to be put to your creditors.  Typically creditors will accept less than 100% of their debt under a PIA. The interest on your debts will also become frozen once the PIA had been accepted.

Once approved by your creditors, a PIA will protect you against any further legal action.  For example if you are in a PIA, then no other creditor will be able to force you into bankruptcy.

We will help you assess what you can afford to pay into a PIA and we will guide you as to the likely term of your PIA.  With a PIAa physical meeting of creditors is required (you may attend by phone in certain circumstances).  Please note that only a Registered Trustee or Solicitor can call a meeting of creditors for you to propose a PIA.  At Debt Free we have a Registered Trustee who can do this for you.  At the meeting of creditors, your creditors will assess and vote upon your PIA proposal.  Not all creditors need to vote in favour of the proposal however, at least 75% (in value) and at least 50% (in number) of those creditors who vote at the meeting must vote in favour of the proposal for it to be accepted. A PIA will effect your credit rating and we strongly recommend that you thoroughly read our frequently asked questions so you fully understand a PIA.

Once your PIA has been approved, the interest on your debts will be frozen. You will only have to make one single payment each month into your PIA. We will distribute the funds to your creditors after we deduct our fees and expenses which will also be approved by your creditors.

Call today for free and impartial debt advice on our toll free line 1800 98 10 70. We will help you establish if you are eligible for a PIA. We’ll discuss your situation in a strictly confidential and empathic manner.

Our debt advice professionals will discuss your individual circumstances free of charge and without obligation.

Remember our advice is free and without obligation,
so call us today toll free on 1800 98 10 70, you have nothing to lose!

If you only have one or two creditors we recommend that you first approach your creditors directly and try to negotiate an informal payment arrangement.  If you have more than two creditors negotiating an informal arrangement may be more difficult and you may need to consider a formal arrangement with your creditors like a Debt Agreement or a Personal Insolvency Agreement.   A Debt Agreement or a Personal Insolvency Agreement will bind all creditors to the arrangement.

Typically creditors may consider an informal arrangement over 12 to 24 months.  If you need more than 24 months to pay your unsecured debts, you may be insolvent and you may need to consider a formal arrangement like a Debt Agreement or a Personal Insolvency Agreement.

We can help you prepare a budget to see how long you need to repay your debt.  and you will pay us an amount each month which we will pay to your creditors on your behalf.

Call today or apply on-line to see which product is appropriate for your circumstances.  We’ll discuss your finances in a strictly confidential and professional manner. Our debt advice professionals are ready to help you today and our service is without obligation.

Remember our advice is free and without obligation,
so call us today toll free on 1800 98 10 70, you have nothing to lose!