Understanding your insolvency options
If you’re in the unfortunate position of comparing your options for insolvency, we provide a little more information below:
Temporary debt protection (TDP)
If creditors are knocking at your door (or inbox), a TDP provides you with protection for 21 days from being pursued by creditors, until you can work through your options.
A Personal Insolvency Agreement
Personal insolvency agreements are between you and your creditor, where you make an agreement to pay an amount agreed either in a lump sum or through instalments.
Part IX Debt Agreement
A Part IX Debt Agreement (also known as a debt agreement) is a formal agreement with your creditors, however is handled by a third party administrator on your behalf. In a Part IX debt agreement, the administrator proposes an amount to your creditors. Instead of paying each creditor individually, you make payments to your registered debt agreement administrator.
Bankruptcy
When you declare that you cannot pay your debts, the formal process is known as bankruptcy. Once you’ve declared bankruptcy, you may be legally released from your obligation to repay some of your debts.
How does declaring bankruptcy affect my credit file?
Once declared bankrupt, you can be given a fresh start by being legally released from most outstanding debts. There are, however, some serious impacts of declaring bankruptcy:
- Your credit rating is seriously impacted.
- The details of your bankruptcy remain on your credit file for up to five years.
- Your details will appear permanently on the National Personal Insolvency Index (NPII).
- Depending on your profession or trade, having previously declared bankruptcy can restrict your employment options.
Finance One is a specialist lender who can help people with bad credit
Including discharged bankrupts. If you require car finance or personal finance after you have been discharged from bankruptcy, we can help.
Apply Online NowSix tips for improving your credit file after bankruptcy
For those looking to turn the corner after bankruptcy, steps can be taken to build back their credit file.
1) Create a budget and stick to it
Sitting down and setting a budget is a great way to monitor your income and outgoings, build up your savings and demonstrate that you are responsible with your income. Seeking professional advice from a financial practitioner can also be beneficial regarding cash flow and budgeting.
2) Stable employment
Holding a stable income is a great way to build financial security and improve your credit rating.
3) Reduce loan applications
Make sure you do your research before applying for finance. Even after you’re discharged from bankruptcy, excessive credit applications can negatively impact your credit score as it can demonstrate to lenders that you are living outside your means.
4) Make any credit repayments on time
Did you know that paying your utility bills, such as phone, internet, gas or power, can influence your credit score? Ensuring you make timely repayments on any accounts will generally positively affect your credit score.
5) Keep your bank account in the green
Your bank account conduct is now recorded on your credit file. Keeping your bank account in the green can help keep your credit score stable and avoid overdrawing fees from your financial institution.
6) Find a specialist lender for bad credit Car Loans
Obtaining bankruptcy car finance can help build back your credit rating if you make all repayments in full and on time. Car finance for bad credit applicants can help provide evidence that you can take out further loans and complete the required repayments.
How hard is it to get a Car Loan after bankruptcy?
As you may expect, loans for discharged bankrupts aren’t a carbon copy of every other form of vehicle finance out there. This doesn’t mean a discharged bankrupt applicant can’t borrow money for a new car. Working with a bad credit lender is the best way to give yourself the best chance of accessing car finance if you’ve been bankrupt.
At Finance One, we welcome vehicle finance applicants who:
- Have a regular income, even if it’s self-employed income or from Centrelink.
- Need to borrow between $5,000 – $75,000*.
- Are at least 18 years of age.
- Have defaults on their credit file, have poor credit or are discharged from bankruptcy.
Apply for a Bad Credit Car Loan with Finance One
Many lenders provide car loans and personal loans, however, Finance One is a specialist lender who can help people with bad credit, including discharged bankrupts.
If you require car finance or personal finance after you have been discharged from bankruptcy, we can help. At Finance One, we understand that life can be rocky sometimes, and a bad credit history is not always representative of your credit future. We’re passionate about helping people get back on track and giving them a second chance at finance.
Contact our understanding team today to find out more about how we can help you purchase a car after bankruptcy.
Apply Now*Loans between $50,000 – $75,000 must be asset backed.
Normal lending criteria, terms & conditions and fees & charges apply.
Disclaimer: The information above is of a general nature only and does not consider your personal objectives, financial situation or particular needs. You should consider seeking independent advice regarding your legal, financial, taxation or other needs, to check how the information relates to your particular circumstances. We do not accept responsibility for any loss arising from the use of, or reliance on, the information. All loan applications are subject to normal lending criteria. Fees and charges payable. Terms and conditions apply.
