What Liabilities are Included in a Part 9 Debt Agreement

What's Included In A Part 9 Debt Agreement

A Part 9 Debt Agreement lets you combine all your debts into one, affordable repayment based on your budget if you are experiencing financial distress. With a Debt Agreement, you can stop creditor harassment, reduce debt stress, and rebuild your finances. The debt agreement has eligibility criteria, just like many debt relief solutions, which includes what debts can and cannot be included, so it is important to know if your debts will be covered. To be eligible for inclusion in a Debt Agreement, a debt must meet the criteria of being a ‘provable debt’ according to the Australian Financial Security Authority (AFSA). In simpler terms, this means that it is a debt that would be resolved if you were to declare bankruptcy. The Bankruptcy Act 1966 considers Debt Agreements to be an Act of Bankruptcy, so you should keep this in mind when deciding if a Debt Agreement is the right solution to your debt. A bankruptcy should only be entered into if you are experiencing extreme financial hardship and are considered insolvent, i.e. unable to repay your debts as and when they fall due.

Examples of creditors liabilities that are included in a part 9 debt agreement include:Liabilities-included

  • Tax Debt
  • Credit Card Debt
  • Personal Loan Credit Cards, Personal Loans & Medical Expenses
  • Payday Loan
  • After Pay Debt
  • Utility Bills
  • Unsecured Bank Debt
  • Unsecured monies left owing over and above the value of bank security
  • Unsecured Creditors
  • Monies owing for Unsecured Medical Fees
  • Monies owing for Unsecured Legal Fees
  • Monies owing for Unsecured Accounting Fees
  • Monies owing from unsecured Personal Guarantee

Examples of debts not removed by a part 9 debt agreement include:Liabilities-not-included

  • Child Support payments accessed by the Child Support Agency (CSA)  HECS, Traffic Fines, Car Loans
  • Court Fines
  • Government Fines eg Speeding Fine (if you do not pay in full you may have difficulty renewing your licence or renewing the rego for your car)
  • Utility bills you need to pay for continuing supply of services. Otherwise, you will be required to pay a bond before services recommence.
  • Liabilities resulting from you engaging in fraudulent activities.
  • Student loans like HECS/HELP/SFSS
  • Victim of Crime liability
  • Secured Debt
  • Liabilities created after your Debt Agreement proposal has been lodged with AFSA

Using Part 9 Debt Agreements Effectively

For further reading on Part 9 Debt Agreements, a good article to read is: Using a Part 9 Debt Agreement to Save your Home.

Can We Help Answer Any Part 9 Debt Agreement Questions?

We are here to help you. If you have any questions on Part 9 Debt Agreements or if you would like to discuss your situation, give us a call on 1300 794 492 or email:hello@understandingbankruptcy.com.au and we will answer your questions without cost obligation.

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