Sadly, bankruptcy is not uncommon in today’s society. With the ever increasing cost of living, people are finding it harder than ever to keep up with mortgage repayments for their property and never ending bills. Some businesses are struggling too as they fight to make a profit and keep debt under control.
What is bankruptcy?
In Australia, bankruptcy is governed by the provisions of the Bankruptcy Act 1966. Bankruptcy is a process that enables a person to sort out their financial affairs by providing a mechanism through which the person’s creditors can be paid, usually not in full. For a business, bankruptcy is a term used when a business has negative net assets. Personal bankruptcy is a little different. Personal bankruptcy is when you are unable to pay your debts and you cannot reach an agreement with your secured and unsecured creditors.
How to avoid bankruptcy
If you are concerned that you may be facing bankruptcy, it is important to seek legal help as soon as possible. Debt can be managed and bankruptcy fought even if you feel like there is no hope. No matter what type of bankruptcy you may be facing, whether it is personal or business, it is always best to seek professional legal advice. Our Lawyers at Preston Law are experienced in dealing with bankruptcy, negotiating debt, handling insolvencies and restructuring debt. Our Lawyers will work with government agencies and debt collectors to restructure your debt and help you avoid bankruptcy.
Reducing risk of bankruptcy
To reduce the risk of bankruptcy it is always best to seek legal advice when setting up your business structure. Our team at Preston Law Cairns can assist you with setting up your business and regularly review your risk of bankruptcy. If you think your debt is getting out of control and you are concerned about bankruptcy, seek legal help from a Lawyer as early as possible. Early intervention from an experienced Lawyer is the best way to reduce your risk of bankruptcy.
The consequences of bankruptcy
Have you ever wondered what actually happens after someone is declared bankrupt? Here are some of the main consequences of bankruptcy.
- Your bankruptcy will be recorded on the National Personal Insolvency Index which can be accessed by anyone.
- You will not be able to travel overseas without written permission from your trustee.
- Your bankruptcy will not cover all debts. Penalties, fines and child support payments will remain unchanged.
- Your ability to obtain future credit will be affected.
- To have services connected you will most likely need to pay a bond.
- Your assets and property will be sold.
- The trustee to administer your bankruptcy retain any income you earn over a certain amount and investigate your financial affairs.
If you are faced with possible bankruptcy, it is always best to seek legal advice from a Lawyer. Some people are hesitant to hire a Lawyer as they are concerned that it will be too costly. In reality, seeking help from a Lawyer can significantly improve a persons financial situation. The financial benefit of hiring a Lawyer will far outweigh the cost. Our Lawyers at Preston Law in Cairns are particularly experienced in bankruptcy, asset and risk management, liquidation, reference claims, receiverships and voluntary administrations. Contact us at Preston Law today.
1/15 Spence St, Cairns City QLD 4870
Ph 4052 0700