File for personal bankruptcy
We tell you what you would keep, what you would lose, and whether there is a better option than bankruptcy.Most people considering bankruptcy have already spent a year or two not considering it. The decision feels like a verdict on who you are, which is why it so often gets made late, or gets made by a creditor instead of by you. It is not a verdict. It is a legal process with an end date, and under the Bankruptcy Act 1966 (Cth) (the Act) that date is usually three years and one day from the day you file. What it costs you in between depends on your assets, your income and the kind of debts you hold, and every one of those is something you can find out before you decide anything.
Know what you would lose
You find out what happens to your home, your superannuation and your job before you file rather than after.
The alternatives properly tested
A personal insolvency agreement is ruled in or out on your actual numbers instead of left unexamined.
An end date that holds
An accurate filing and a compliant bankruptcy is what keeps your discharge at three years instead of extending it.
What actually happens when you go bankrupt?
Bankruptcy is a formal process under the Act that releases you from most unsecured debts, generally three years and one day after you lodge your statement of affairs. In exchange a trustee takes control of your divisible assets, you have to disclose your income and assets, contributions become payable if you earn above a set threshold, and restrictions apply to credit, overseas travel and a small number of occupations. Superannuation is generally protected, and so are ordinary household goods, tools of trade and a vehicle up to set limits, which is the part most people do not know while they are deciding.
Will I lose my house?
It depends on the equity, not on the house. If there is meaningful equity above the mortgage, the trustee can sell it and pay that equity to your creditors. If there is little or none, a sale often is not worth the trustee pursuing. We can tell you which of those you are in before you file.
How long does bankruptcy last?
Usually three years and one day from the date you lodge your statement of affairs. The trustee can apply to extend it, and the usual reason is a failure to meet your obligations, such as not disclosing assets or not paying income contributions. Staying current with those obligations is the reliable way to reach discharge on time.
Which debts does bankruptcy not wipe out?
Most unsecured debts go, including credit cards, personal loans, trade debts and judgment debts. Some survive it. Child support and maintenance, court fines and penalties, HECS-HELP debts, and debts you incurred by fraud all continue afterwards. We can go through your specific debts and tell you which is which.
Can I keep working, and will my employer find out?
You can keep working, and bankruptcy is not listed against you at work. A small number of occupations and licences are affected, and company directorship is one of them. If you earn above the threshold set under the Act you will pay income contributions to your trustee, and we can calculate what yours would be.
Before you decide, find out what it would cost
We will work through your assets, your income and each of your debts and tell you what bankruptcy would take, what it would leave, which debts it would not touch, and whether a personal insolvency agreement would serve you better. The conversation is confidential and it commits you to nothing.
Debt does not sit still while you decide
You owe more than any realistic repayment plan could reach, enforcement has started, and you cannot tell whether bankruptcy is a solution or a surrender. Underneath the practical question is a harder one, which is what it would say about you, and whether you would be handing over your house for a process you did not have to enter. So the decision keeps getting put off, and while it is put off the debt keeps growing.
- We will review your debts, assets and income and advise whether bankruptcy is the right tool for your situation.
- We will tell you what you would keep, what you would lose, and which debts bankruptcy does not release you from.
- We will test the alternatives, including a personal insolvency agreement, before you commit to anything.
- We will prepare and lodge your statement of affairs and debtor's petition.
- We will advise you on your obligations to the trustee and act for you if the trustee or a creditor takes issue.
You have stopped opening the mail
The debts came from somewhere specific. A business that did not make it, a marriage that ended, a stretch of illness that stopped the income but not the bills. Since then judgments have been entered, a garnishee is taking a slice of your wages before you ever see it, and the calls have become a fixture of the week. You have thought about bankruptcy and then stopped, because nobody has told you what actually happens to your house, your superannuation, your job, or your ability to borrow again afterwards.
What's included in your personal bankruptcy service
- A full assessment of your debts, assets, income and dependants.
- Advice on what bankruptcy takes, what it leaves, and which debts survive it.
- Alternatives review, including personal insolvency agreements.
- Statement of affairs and debtor's petition preparation and lodgement with AFSA.
- Advice and representation through the bankruptcy period, including income contribution assessments.
What another year of waiting does
Debt that is already unpayable does not hold still. Interest compounds, judgment debts pick up enforcement costs, and each writ and garnishee adds a figure that was not there last year. The amount you would eventually be released from grows, and so does the damage done getting there.
The larger cost is the one nobody counts. Sustained creditor pressure takes a real toll on your work, your health and the people living with you, and it does that for exactly as long as the decision stays open. Waiting also closes doors. A personal insolvency agreement needs your creditors to accept a proposal, and creditors who have already spent money enforcing are far less inclined to accept anything. Putting the decision off does not keep the alternatives to bankruptcy available, it removes them.
From an unpayable number to a date it ends
We start with the whole picture. Every debt, every asset, your income and who depends on it. Then we tell you what bankruptcy would do to that picture item by item: which debts would go, which would follow you through regardless, whether there is enough equity in the house for a trustee to be interested, and what your income contribution would be at what you currently earn.
Sometimes that assessment says bankruptcy is not the right tool and a personal insolvency agreement is, and we will tell you so. Where it is the right tool, we prepare your statement of affairs and debtor’s petition properly, because an inaccurate one is the most common reason a bankruptcy runs longer than three years. Then we keep you compliant through the period, so the end date stays where it started and you reach discharge able to begin again.
How we walk you through it
From a full picture of your position to the day it ends.Map your position
We work through every debt, asset and income source and tell you precisely what bankruptcy would take and what it would leave you.
Test the alternatives
We check whether a personal insolvency agreement or another arrangement would give you a better outcome than bankruptcy on your numbers.
File and finish
We prepare and lodge your statement of affairs and debtor's petition, then keep you compliant with the trustee so you reach discharge on time.
Advice that tells you what you would lose before you choose
Nobody arrives at this conversation quickly. By the time most people ask, they have carried it on their own for a year or more, often without telling the people closest to them, and the shame delays the decision far more than the law ever does. It is worth saying plainly that insolvency is a process, not an assessment of your character.
One of our lawyers holds the ARITA Advanced Certificate in Insolvency and is a member of the Australian Restructuring Insolvency and Turnaround Association, so this is insolvency advice from someone formally trained in it. We have taken people through the decision, the filing, the trustee’s questions and the discharge at the other end. We will give you the honest version, including the parts you would rather not hear, and leave the decision with you.
Our great lawyer guarantee
Six principles we hold to, whatever you bring us and however long it takes.
Take the time
We listen carefully to understand what you want to achieve, then step you through the advice and the documents.
Share our knowledge
We pass on as much as we can, so you can make your own informed decisions.
Stick to our knitting
We only do what we are good at, so you never pay for our learning.
Work as one team
Someone is always available to answer your question or point you the right way.
Fair pricing
A fixed or capped quote for advice and documents, so you do not carry the price risk.
It is your show
We are in it for a front row seat to witness your success, not for our egos.
Find out what bankruptcy would actually cost you
Bring us your debts, your assets and your income. We will tell you what you would keep, what you would lose, which debts would survive it, and whether there is a better option available to you. Then you can decide with the facts in front of you.
More on this area of law
Read more about personal bankruptcy, personal insolvency agreements and getting a fresh start, and how ADLV Law can help.