It is important that you understand the impact of such an agreement. Contact us today to find out if this action is the best for you. A debt contract will reduce your total debt, suspend your interest and get creditors out of your back, giving you time to pay off your debts in peace. For some, reaching a debt agreement is an effective debt cancellation strategy. If your creditors accept your proposal: if you want to avoid bankruptcy and you have income, debts and assets below the legal limit, you can submit a debt contract for up to three years or five years if you own a home. Before you compete or consider a debt contract, you should explore your other options for managing uncontrollable debt. Before you advance the agreement with a debt contract, you need to understand the consequences: a debt contract has a term of 3 years, but the duration can be up to 5 years if you own a house. Debtors will be discharged from most of their debts after the completion of all payments and obligations arising from the agreement. If the proposed debt agreement is adopted by the creditors, you must respect the agreement and ensure that it is concluded on the date indicated in the proposal.
If a debt contract is an option you`re considering, you don`t have to do it alone. You can run a business, unless the terms of the agreement provide for something else. However, if you are acting under a company name or a supposed name, you must disclose the debt contract to anyone you are dealing with. The AFSA sends each creditor a completed report, copies of the debt contract and a statement of reasons, a request and a voting form. We help you organize the debt contract and stay the course To accept a debt contract proposal, AFSA must vote “yes” to a majority (in dollar terms) of the voting creditors. Applying for a debt contract is a bankruptcy, which means that your creditors can bankrupt them if they do not accept the proposal. A proposed debt contract becomes a formal agreement if the creditors accept the terms of your proposed debt contract, either in writing or by vote at a meeting. Financial advisors can also help you understand the impact of bankruptcy and debt contracts. We will then arrange the full paperwork and take care of the day-to-day management for the duration of your debt contract. Complete the debt agreement with AFSA within 14 days of signing it and deposit it. Despite the announcements of debt agreements, which often seem to offer debt consolidation, debt agreements are not debt consolidation. This is a formal agreement under the Bankruptcy Act.
A debt contract is a formal alternative to bankruptcy, where all your creditors agree to accept the partial payment of the debt equally. It is manufactured under Part IX of the Bankruptcy Act. You don`t have to be able to pay your debts for this type of agreement. No other interest will be generated on the debt included in your debt contract if you are, it is understandable. In some cases, a formal debt agreement can increase your financial stress. The proposal must be accompanied by a statement on the debtor`s affairs. If the proposal is accepted by the official beneficiary, the official beneficiary must write to creditors to inform them of the proposal, provide creditors with a summary of the debtor`s statement of affairs and ask them whether they should be accepted or whether a meeting of creditors should be convened. If the agreement does not define how the property should be distributed, it must be distributed in relation to the demonstrable debt. This provision only applies if there are not enough resources to pay all creditors.