Hey,
(Please post anonymously)
So a little back story - single mum with minimal debt (able to be paid off), then mother kicked us out so we had to start from scratch. In doing so, my older debt has been pushed aside to try and keep life’s wheels moving ( I believe this was my mother’s plans to fail). I should have gone bankrupt 3 years ago to deal with it but pride has gotten the better of me, but I believe it’s my best option. Has anyone gone through the bankrupt companies eg beyond debt etc or have you just gone through the national debt helpline? Does anyone have any regrets about doing this and did you feel that sense of relief mentally?
4 Replies
Going bankrupt should be your last option. It will make life so much harder. Go and see The Salvos or similar and ask to see a financial counsellor. They will walk through everything with you and make a plan for you to work your way out of your debt. Also borrow The Barefoot Investor from the library and start reading it. Good luck. You've got this!
Bankruptcy will not make your life so much harder. There is alot of misconceptions around it.
I went bankrupt many years ago and it has not negatively effected our lives at all. The relief was such that I cried when it went through. From throwing up from stress to its gone.
It gave us a huge kick up the backside and we got our act together financially. Haven't owed money to anyone in over 9 years and ill never have anything but a home loan, no other type of loan ever never ever again. My credit score is now in the 800's.
Always try to avoid it if you can but if you can't so be it. Not the end of the world either. A part 9 debt agreement will effect your credit just as much too. But that is also an option you have.
Stay away from places such as My Budget or anywhere who manages your money for you for a fee. Find a community centre that provides free financial advice. They can help you negotiate with creditors if needed.
And talk you through a part 9 and bankruptcy as options.
All the best to you in whatever happens ox
I can't see how going bankrupt is an option. your first line said the debt isn't that big, and is manageable.
Your mum might not be a nice person but your debt and living costs/ arrangements are not her responsibility.....
My sister was bankrupted by her ex husband and his shitty business. this was 7 years ago, and to this day she can't get a phone on contract has been knocked back for a car loan. It's not a quick fix, solves today's issue and causes years of drama. Who is the debt with? can you enter another payment plan? most places would rather you do something and can be flexible if they fee you will hold up your end of the bargain. Time to work out how to own your mistakes.
I didn't go bankrupt, but I did get a Part 9, which is a step before bankruptcy.
Essentially the administrators (I used Fox Symes) contact your debtors consolidate all the debt to 1 figure and you then pay the debt back (without interest), so just the money you actually spent over the course of 5 years. The debtors listed in the part 9 cannot call or interact with you at all during that time which Is a huge relief.
(You can't do this if you have government debt like centrelink or child support or tax debt, or if you have less then 5k or 8k I can't remember what the figure was, but I wouldn'tdo bankruptcyor a part 9 if it was under 10k anyway!)
You will have a dirty mark on your name for 5 years and won't be able to get credit at all. I did have a little bit of trouble trying to get a broadband connection, but aside from that I was able to get all other utilities fine. (If you have a existing phone/internet plans I was able to recontract and upgrade etc.. but not able to port to different companies during the 5 years)
I call it Credit Jail... so you will be in " credit jail" for 5 years, after that (assuming you have paid off your debt) it clears off your account and you are as good as new.
I have secured a mortgage now, and have a perfect credit record and a small credit card (2k) which helps towards keeping my credit clean. I have signed up to Equifax credit notification system so as soon as anything touches my credit file I can see it.
It was worth it for me. Mistakes happen, owning it and doing whatever means possible to fix it is what matters.
Good luck!