What I do not like about the alternatives to bankruptcy – Debt Agreements and Personal Insolvency Agreements (PIA)

  • Unlike bankruptcy, the legislation does not provide for the amount of income the debtor can retain to ensure essential needs can be provided for. This can result in people over committing and having insufficient income to meet daily needs, causing persons to remain under financial pressure with all the negative consequences that may evolve from same
  • The legislation does not provide a limit for the period of time a Debt Agreement or PIA is to remain in force for. This can result in the proposed Debt Agreement or PIA going for a longer period of time than the 3 years of bankruptcy. My observation is that the longer a Debt Agreement or PIA goes for, the more it wears people down and reduces the chances of it being successfully completed
  • A Debt Agreement and PIA do not provide the debtor with a release from his or her liabilities until finalised. If the Debt Agreement or PIA goes for 5 years, the release from the liabilities will not occur until 5 years’ time if all terms of the agreement have been met by the debtor

Alan Nicholls’ no obligation help desk

Nicholls & Co provide a free, no obligation ‘help desk’ for people considering bankruptcy – we discuss and explain bankruptcy and answer questions for anyone who is considering bankruptcy. The Nicholls & Co help desk can be accessed by phone (1300 060 122) or helpdesk@nichollsco.com.au . Alan Nicholls, Registered Trustee in Bankruptcy is also available to answer your questions to enable you to decide if bankruptcy is right for you.