Declearing Bankruptcy – FAQ

Can I travel to other countries?

Yes. All you will need to do is apply to your bankruptcy trustee for approval to go. You’ll get it, but there is a one-page form you will need to fill in simply to notify the trustee of how long you will be taking a trip, etc. This measure is really only there so high rollers don’t skip the country. Sometimes the trustee will ask for your passport, but don’t stress about it because you can request it back when you have to travel. Call us if you want to know more about travel on 1300 795 575.

Can I keep my property?

In many cases the answer is yes! Actually, in most cases nowadays we can help you keep your home. At Bankruptcy Experts we are experts at guiding people keep their homes. It’s possibly very tricky, so if you are concerned about losing your home call us on 1300 795 575 and we will walk you through your options.

The thought of losing the family house is probably the most common obstacle to people declaring bankruptcy. We speak with people day after day who have fought for years under extensive financial tension so they don’t lose their home.

So how is it possible to become bankrupt and keep your house? Easy, really; it’s a matter of equity. Let’s put it this way, if you own a house that’s worth $350,000 and you owe the bank $350,000 you effectively have no equity in the house, right? The trustee will only sell off your house if there is enough equity in the home if sold to pay back some of your debts. So in this particular scenario, the trustee will then give you some choices, one of which is to simply to continue paying the mortgage and stay in the house while you are bankrupt.

So how can I find out the market value of my home? A simple way is to go onto au and check out the sold houses tab in the Rockhampton area and it will show you all the recent sales in your location. Another option, if you are confident or are very uneasy, is to have a registered valuer do a valuation on your home, not a real estate agent (unless they are registered valuers, of course). Be warned this will cost you somewhere between $300-700. Just one more aspect of house prices. If the trustee wants to sell your house they do so reasonably quickly. It’s not a 6-month glossy marketing campaign and instead it’s actually by auction and they just meet the market on the day and that’s it. So when contemplating the value remember it’s a sell now price, not when the market picks up.

Once you have determined the market value of your house the next thing to look into is ownership.

Generally most home loans are between 2 people as joint tenants who both contribute to the mortgage. If only one party is filing for bankruptcy then the equity is calculated like this.

Say your home is worth $400,000 and the current price is $350,000. Then the remaining equity in the home is $50,000, right? Half of that total equity is automatically allocated to the party not going bankrupt, leaving $25,000 for the bankrupt. Out of that $25,000 the bankrupt party needs to pay for all of the selling costs including advertising etc., which, according to where you live, can cost anywhere between $12,000-20,000. In this case say the selling costs are going to be $15,000 then the balance left over after the sale is $10,000. So in this case the trustee will give the non-bankrupt party several options. One of which is common is for the bank to say, “Pay us the $10,000 and we won’t sell the house and you will have it eliminated as an asset from the bankrupt’s estate.” Or, in other words, negotiate to pay the $10,000 and you can keep your home.

Just a side note: the lender who has given you the home loan will require the repayments to be kept up naturally. Regardless of what the trustee decides, if you don’t pay the lender the home loan they will eventually ask you to move out. So, put simply, keeping your home obviously implies keeping the debt also.

There are plenty more possibilities with your home, and we have just detailed one option of potentially 20 possibilities you can choose from, when it comes to your house. We understand you will want to get this correct. Gambling with the family home can be an overwhelming business. If you intend to get the appropriate advice or you just want to talk to someone give us a call on 1300 795 575.

When would my travel be restricted?

Your international travel would be restricted by the trustee as a result of legal action. For example, if your bankruptcy is a part of a criminal investigation or fraudulent activities, it’s possible the trustee will restrict your travel.

What happens to my credit rating?

Bankruptcy lasts 3 years and will sit on your credit file for that time. However, just like any default it will turn up on your credit file for 7 years. You can have it eliminated if you get your bankruptcy annulled.

Will I ever have the ability to borrow money again once I’m bankrupt?

Bankruptcy is for 3 years, and in that time you will not get a loan. After the 3 years is up you will have the chance to get loans; you just won’t get the very best rate. Your credit report will be wiped clean 4 years after you have been discharged as a bankrupt then you will have an ideal credit record again and you will get the most competitive deal on loans.

Will I lose my car if I go bankrupt?

Usually no. Bankrupts hardly ever lose their cars because they’ve gone bankrupt. Naturally, this is conditional and we can let you know if yours is safe. Call Bankruptcy Experts Rockhampton on 1300 795 575.

There is a threshold or amount of wholesale value your car can possibly be worth while you are bankrupt, which is $7,350. You will find all kinds of inaccurate information about this on the internet, but here are the facts. That $7,350 represents not the total value; it represents equity. So, simply put, if you have a car worth $35,000 you are repaying or leasing and the amount you could sell it for is $30,000 then you can keep your car because its equity is only $5,000. The company that lent you the money for the car will be happy for you to keep the car even though you are bankrupt as long as you continue the payments.

What happens to my Centrelink debts if I go bankrupt?

As a general rule we have always told our potential clients not to count on having your Centrelink debt written off when you declare bankruptcy, however it seems more and more this is not the case.

In most cases it has been our experience that Centrelink will not pursue you for your Centrelink debts*(which is also outlined on the Centrelink website – see link below) for the three years you are bankrupt which is good news for those struggling week to week and need to file for bankruptcy to get some financial relief. What seems to be happening more and more lately is that they (Centrelink) may now just simply write the debt off at the end of the three years also. We had a client just the other day send us a Centrelink letter (See below) stating that not only that they wont pursue the debt for the 3 years of bankruptcy but also that they wont chase you for the debt after you have been discharged. In other words you wont ever have to pay back your Centrelink debt if you file for bankruptcy.

What if I’m behind on my car payments and I go bankrupt; will they reposess my car?

Get some advice on this one. If you need some advice right now just call 1300 795 575. Basically, you will get about 2 to 3 payments grace when it comes to car loans. The bottom line is simple: whether you are bankrupt or otherwise, if you miss 3 or more payments on your loan the bank will repossess the car. Don’t presume because you are going bankrupt you are automatically going to lose your car because in most cases we help people retain them.

When are the creditors advised of my bankruptcy?

The creditors, or individuals you owe money to, are notified in writing at about the same time you receive your bankruptcy file notification.

Will anyone come to my home?

No. The bankruptcy process is primarily a paperwork exercise. The only thing that actually occurs is you will either be sent a letter by snail mail or emailed a letter informing you that you are bankrupt. At Bankruptcy Experts Rockhampton we make sure that this entire procedure is that simple, so if you have concerns about this phone 1300 795 575.

Can I have my bankruptcy annulled?

Yes. This process will take about 2 weeks and will totally get rid of the bankruptcy from your credit file. There are provisions within the Bankruptcy Act that allow a bankrupt person to have their bankruptcy annulled through a Section 73 proposal.

The repercussions of creditor’s claims can often result in bankruptcy, despite whether or not it was the individual’s choice to enter bankruptcy, or if it was filed by a creditor. However, bankruptcy is far from the end of the world for the individual who undergoes bankruptcy.

We have been assisting people in the Rockhampton area for many years so call us today on 1300 795 575 to get some advice on this matter. We exercise the best possible strategy for you to get back up and running, removing residual effects and hindrances of past financial situations to give you the best possible outcome. Having experience and skills specialising in Section 73 proposals, we can combine this with our proven solutions and methods to bring you through bankruptcy in one piece, ready to start over.

Can I get my bankruptcy annulled?

Firstly, having your bankruptcy annulled is basically reversing it 100 %. So if you are thinking you would like to have your bankruptcy annulled there are a few things you need to know.

Firstly, how does the annulment work? An easy way to understand it is let’s say somebody owes you $50,000 and they haven’t paid you one cent back for years. Then to make matters worse you discover that they have gone bankrupt. You would kiss that money goodbye, right? Years pass and they approach you with an offer to repay you $5,000 that their aunty is offering to them to settle your debt with them. Undoubtedly you are happy to take it, because it is better than nothing. The only condition they ask for in return is that you agree to have the bankruptcy cleaned from their credit file, and if you don’t agree to do that then there will be no $5,000. Obviously you don’t care about their record; you are just happy they are offering you some money after all these years.

In bankruptcy terms this technique is commonly described as a Section 73 proposal, and it’s an approach where “everybody wins.”.

Essentially the trustee contacts your creditors, puts forward your offer, which is substantially less than the original debt owed, on the condition they clear your credit history clean.

This approach takes a few weeks. The proposal can be done at any moment in the 3 years you are bankrupt. However, you need to consider the timing of your proposal. Because it does cost money to do this, you want to make certain the odds are on your side. For example, if you are paying back money to the trustee each week because you earn over the threshold amount, then your creditors will know they are going to get a certain amount from you over the 3 years in any case so it better be more than that will add up to.

If you have only been bankrupt 3 weeks it will be harder to get an annulment because they could get some cash from you over the 3 years if you earn over the threshold sum of money.

If you want support to put a section 73 proposal to your trustee or just need more information about the timing of when to put a proposal forward, just phone us on 1300 795 575.

Can I go bankrupt if I’m currently in a Debt Agreement or Personal Insolvency Agreement or in a Consolidation Loan Contract?

Yes! We can assist you get out of all of these agreements. With Debt Agreements and Personal Insolvency Agreements we need to have you released from them first before you declare bankruptcy, but it’s not a problem. If you are locked into one of these and simply can’t get on top give us call at 1300 795 575.

What debts won’t bankruptcy wipe out?

There are very few debts that bankruptcy won’t 100 % remove, like Centrelink, child support, HECS and a court-imposed fine (speeding fines, etc.) and, finally, money owed to an insurance company as a result of a car accident in an uninsured car that you were driving.

Other than that, it will cancel debts like your credit cards, store cards, GST and tax, unsecured personal loans, etc. In reality, there are way too many things to list so if you have a particular debt you are worried about just call for a free consultation 1300 795 575.

Is there a limit to the amount of debt I can go bankrupt for?

You can’t file for bankruptcy for an amount below $5,000; however, there is no limit beyond that. If you owe a couple million dollars, that’s treated no differently than $20,000.

What is the difference between a secured and unsecured loan?

An unsecured creditor is a creditor who does not have a hold over the chattels/assets/property acquired with the credit afforded to you. Such debts include credit card debts.

A secured creditor has a hold over the chattels/assets/property until the debt is paid in full. If a debtor defaults on a secured obligation, the creditor has the right to repossess and sell the chattels/assets/property to pay down the debt.

How can I make certain that you will be successful in making me bankrupt?

We have helped thousands of people file for bankruptcy over the years and we have never had anyone’s application rejected. That’s why we offer a 100 % money back guarantee.

Suppose I’m not completely sure who I owe money to?

There is a basic approach we use here, and all you have to do is get a copy of your credit report as it will have your entire credit history on there. Companies like will have the ability to get you a copy for a small fee.

I’ve had a car accident. Will the debt be covered in bankruptcy?

Vehicle accidents can be tricky, so to keep it simple call us on 1300 795 575 to get the right advice on your situation. However, as a general rule, if you were driving a vehicle that was not insured then the cost of the repairs is not erased with bankruptcy. Having said that, it depends who admitted liability or who was at fault. If you go to court and the court proves you were not at fault then you should be good.

Can I have business debts eliminated with my bankruptcy also?

Yes! We can help you carry this out, although it’s possible there are implications and a number of regulations around this procedure, so phone us and we will guide you through the process on 1300 795 575. Bankruptcy Experts Rockhampton are professionals at assisting businesses get back on their feet.

Can I pay out my bankruptcy debt and have it annulled?

Yes. There is a technique to follow, but if you win lotto or inherit some funds you can use it to get your slate wiped clean. There is a way of carrying this out properly; just phone us first.

What if someone is bankrupting me; is there anything I can possibly do?

Generally, if you owe money to a lender they can get a court order and bankrupt you. They have to follow a process, but it is feasible. What you need to avoid at all costs if possible is another person bankrupting you, as it’s always best to voluntarily file for bankruptcy. Unless you enjoy attending court and annoying phone calls, of course.

What if my company has received a Demand or Wind-Up notice; can I still go bankrupt?

Yes. However, this is a complex process and we suggest you get some professional advice; if its handled incorrectly, it could be fatal. For a free consultation phone Bankruptcy Experts Rockhampton 1300 795 575.

Do I need to contact my creditors?

No, we do that for you. Actually, we serve as an intermediary or a midway point between you and your creditors. So basically you are not obligated to inform them of your bankruptcy; we do that for you.

How long does bankruptcy last?

3 Years.

How long does it take to file for bankruptcy?

Usually, it takes about 2 weeks.

What if someone else signed for a loan (joint loan or guarantor) and I go bankrupt; will they still be liable for the debt?

Yes. Normally a lender will pursue the other person who signed the loan documents with you for the full amount of the outstanding money owing on the loan.

What happens to a debt I forgot about at the time of becoming bankrupt?

Don’t panic! If you forgot about a debt and remembered it later, just call your trustee with the name of the creditor, address, date the debt was incurred, sum of debt and any account or reference number/s provided by the lender. Your trustee will add the creditor to your bankruptcy paperwork and mail a notification to the creditor.

Do I have to go to court if I go bankrupt?

No. We take care of the entire procedure for you.

What if I have gambled some of my money and I go bankrupt; will I get in strife?

Usually this is not a problem, so if you are a gambler, don’t worry. What the trustee doesn’t like is inconsistency here. In other words, you have never taken a chance in your life and all of a sudden you lost $50,000 on the horses, then you might have some explaining to do, of course, because it just doesn’t add up.

Can my bankruptcy be done over the phone?

Yes. We understand you are busy. If you have a phone we can help you; simply call us on 1300 795 575.

What if I’m living overseas; can I still go bankrupt?

Yes. This is feasible. It necessitates some emails back and forth but it can be performed.

Can I include my international debts in my bankruptcy?

Yes. If a person originally staying in another country now residing in Australia then files for bankruptcy and they have a debt incurred in that foreign country, you just register that debt on the paperwork.

In many cases the creditor overseas will erase the debt. It is possible and legal for them, however, to reject your application, and if you go back to that country you may be subject to their bankruptcy laws.

How will the trustee know what assets I have?

There are a few ways the trustee can discover, and the most effective and easiest way is for you to tell them when we do the paperwork. There is also a government register which has major assets listed also. You have to get some advice about assets; be careful.

Can I keep an inheritance if I file for bankruptcy?

This is complicated and you will require the correct assistance, so if you need more information about inheritances phone us on 1300 795 575.

Will I lose my Pension or Workers Compensation payments if I go bankrupt?

No. The income thresholds are the same for everyone so regardless of how you earn your income you have to earn about $50,000 per year before your income will be affected by bankruptcy.

Will I have the ability to keep my income tax return once I’m bankrupt?

Yes, if you owe the ATO money. Put simply, if none of your debts is tax debt, then no, the Australian Tax Office will keep the cash you owe them.

No, if you do not owe the ATO money. Your income tax return is viewed as take-home pay, so if you are under the threshold amount you can earn while bankrupt then you will get your whole tax return back.

What about my child support obligations ?

If you need to pay child support, this money will be deducted from your net income, so what you have the ability to keep after you pay your tax and then child support is considered net income. That is why in the world of bankruptcy net income figures are always quoted.

Can I buy shares and make investments while I’m bankrupt?

Yes, you are allowed even while you are bankrupt, but the trustee will take them off you, as they are considered an asset.

What assets can I keep if I go bankrupt?

You can keep practically everything except big things like houses, cars, shares and inheritances. Even things like houses and cars may be able to be spared. Just give us a call before you make any big decisions on 1300 795 575 for Bankruptcy Experts Rockhampton.