Debt Agreements

Introduction

Debt Agreement Summary

• Like a debt consolidation loan, Debt Agreements put all of your individual debts into one pool of debt. These debts need to be unsecured debts, e.g. Credit Cards, Personal Loans, Overdrawn Bank Accounts, Store Cards, Repossessed Cars, old Electricity/Gas Accounts (previous addresses), disconnected Telephone/Mobile Accounts, School Fees, Childcare Fees, old Pay TV Accounts, etc.
• You make one easy, affordable weekly or fortnightly repayment that covers the Debt Agreement.
• Legally creditors must stop contacting you and any legal action is stopped, including bankruptcy.
• Interest charges are frozen.
• What you can’t afford to repay is written off.

Debt Agreement Criteria

There are a number of criteria you need to meet to enter into a Debt Agreement, put in place by the government.

1. Take-home pay (after tax income) of less than approximately $1,218.52 per week.
2. Unsecured debts cannot exceed $84,484.40 – approximately.
3. Cannot have assets of more than approximately $84,484.40.
4. Cannot have been an undischarged bankrupt nor had a Debt Agreement in place over the last 10 years.

Consequences

• The fact that you enter into a Debt Agreement will appear on your credit history for 7 years.
• Your name will appear on the NPII, a permanent government record typically not used for assessing credit applications
• After you repay your Debt Agreement your credit history will be updated.
• All included debts in the Debt Agreement will be closed.

Contact Debt Mediators Australia today to find out more about Debt Agreements.

Try our Debt Agreement Calculator