How To Handle A Creditor, Debt, And Bankruptcy​


If a creditor is taking action to bankrupt you, the first thing to check is whether you owe money to the creditor. There have been instances in the past where a creditor has been paid but the bankruptcy action has continued due to the creditor not realising payment had been received.

Dealing With Creditors, Debt, And Bankruptcy

If you dispute the debt, contact the creditor, and commence a conversation.

For a creditor to bankrupt you, the creditor must first have a judgement debt and then apply to the Australian Financial Security Authority for a Bankruptcy Notice. This is then required to be served on you and you then have a 21-day moratorium in which the creditor is not able to take further action against you. Once the 21 days have expired, the creditor can proceed to commence a Creditor’s Petition for the Court to consider making an Order – declaring you bankrupt.

By preemptively lodging a bankruptcy form with the Australian Financial Security Authority and becoming bankrupt, you can circumvent the court process. Lodging this form yourself is sometimes referred to as voluntary bankruptcy.

We recommend that you take control and take action to do this yourself. By doing this your stress levels will be lower as you will be in control. It also stops people turning up at your house to serve documents on you and you not knowing what will happen next.

If you are faced with a creditor commencing action to make you bankrupt, we recommend you give us a call to discuss your circumstances and we will give you our thoughts and recommendations.

We are here to help. If you have any questions please give us a call on 1300 794 492
or email

Ask Us A Question

Give us a call on 1300 794 492
Alternatively, you can leave us a message and we will get back to you as soon as possible