Similar to a Debt Agreement, a Personal Insolvency Agreement is another process you can take to combine multiple debts into one. A Personal Insolvency Agreement might be beneficial to you on your journey to a debt free life.
The process includes freezing interest on all of your current debts and combines them into one larger debt. You then negotiate an amount you can afford to pay off your lump debt, and the remaining debt will be removed.
Personal Insolvency Agreements (PIA) are an ideal choice for higher income earners who have owned assets. There is not upper limit for a PIA in terms of one's income. This means it can be a great option for those who aren't eligible for a Debt Agreement who do not want to declare bankruptcy.
A person who qualifies for a Personal Insolvency Agreement will typically have debts exceeding $113,349.60, a net income over $85,012.20 per year, or assets worth more than $113,349.60.
If your debts, income, or assets are less than the above figures, you can consider a Debt Agreement.
Beyond Debt can assess your eligibility for a PIA and figure out what you can afford to pay based on your income and debts. You will then engage Beyond Debt to act on your behalf and negotiate terms for your PIA and payments. This includes credit and income checks, and the valuation of your assets. The creditors will come together for a meeting and a vote, where it will be decided if your PIA is accepted. Your Agreement then becomes legally binding.
While a Personal Insolvency Agreement is not equivalent to declaring bankruptcy, it is still an act of bankruptcy. This means your details will appear on the National Personal Insolvency Index (NPII) permanently. After entering a Personal Insolvency Agreement, you will not be able to manage a corporation, or sell assets without trustee consent.
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