When the collections calls are coming in and you’re worried you can’t repay all your debts on time, it’s time to consider your options.
While formal options such as filing for Bankruptcy and Formal Debt Agreements offer a lot of benefits, sometimes the disadvantages like public records that affect your credit rating or job eligibility leave you looking for other options.
Sometimes your financial problems are only short-term, so restricting your income or risking the loss of your assets isn’t ideal.
If you can just negotiate a freeze on interest or a different repayment schedule, you’ll be able to get things back on track.
In cases like these, Informal Arrangements are a debt relief option that offers many of the benefits of formal options without the same public records or financial restrictions.
Often, if you can simply negotiate with your creditors to make your repayments more affordable, you’ll be able to get the debt relief you need without the consequences of using more formal debt solutions.
The problem is, negotiating with creditors yourself can be difficult, especially when you’re already dealing with the stress of struggling to make repayments.
It can be hard to talk to your creditors in terms they understand, or help them see your side of the situation.
Informal Arrangements are simply a private agreement between you and your creditors to lower your payments so you can keep paying back your debts in a more affordable way.
Like formal debt solutions such as Formal Debt Agreements and filing for Bankruptcy, Informal Arrangements can help you get debt relief when you’re struggling to make repayments.
Unlike formal debt solutions, there aren’t any public records of your Informal Arrangement, you won’t have to declare your assets and risk losing them, and there are no eligibility requirements that limit your ability to use them.
This makes Informal Arrangements a great option if your financial problems are only short term, you don’t have that much debt, or a public record of financial trouble would affect your ability to keep your job.
The main difference is that Formal Debt Agreements are controlled by Australia Government legislation while Informal Arrangements are not.
You’ll need to maintain the regular minimum repayments with that creditor.
Unlike a Formal Debt Agreement or filing for Bankruptcy, Informal Arrangements are not entered on your credit report.
As long as you keep up with your repayments according to your arrangement, a default on your debts shouldn’t be recorded either. However, if you miss payments, your creditors may initiate the default process, and any existing defaults on your report will not be removed by an Informal Arrangement.
As long as your creditors accept your agreement, there is no limit on the amount of debt that can be included. Unlike Formal Debt Agreements, there are no minimum requirements for the amount of debt you owe in order to qualify for an Informal Arrangement.
Typically, a direct debit from your bank account is set up to allow you to make one single payment that covers all the debts included in your Informal Arrangement. These payments are designed to be affordable, and can be made according to your paycheck schedule (weekly, fortnightly, or monthly).
Like Formal Debt Agreements, there are no restrictions on your ability to travel abroad or operate a business.
If you’re struggling to pay your debts, owe multiple creditors, and are tired of receiving endless collection calls, you have options.
We know exploring those options, filling out the necessary paperwork, and negotiating with your creditors to resolve your debt can be just as stressful as having it in the first place.
That’s why we’re here to provide you with the information and help you need to make the right decision, though our debt negotiation services.
If you’re ready to end the collection calls and finally get free from debt, contact us today to learn whether an Informal Arrangement is right for you.