Bankruptcy in Mildura - Changes to help Small Business and Entrepreneurs

Do you know just how much Bankruptcy Mildura is changing? The Australian Government at the end of 2015 moved for some progressive changes to the Bankruptcy Laws in Australia. The most significant of these is the length of time that a person is bankrupt for. Now, there is a minimum amount of time that you must stay bankrupt, having said that, this 3 year period may in fact be reduced to just 12 months. So if you are asking about Bankruptcy, this news may be somewhat important to you.

Mark Carnegie in the Financial Review on the 7th December 2015 proposed that "the proposed changes to ease the burden of bankruptcy laws didn't go far enough and the government should adopt US-style laws to protect the family home".

These changes to the issue of Bankruptcy will take 18 months to implement. Mr Carnegie, went on to say in the Financial Review that defending family assets was very important because "banks just terrorise small business and the mental health consequences to society are enormous".

The problem is Australia's bankruptcy laws discouraged investors from supporting start-ups, and therefore mentoring had been "driven out of the system".

"They naturally find it very intimidating themselves personally and with their assets at risk in a risky early-stage deal, but with their own money in the deal and a lightened-up provision I think we 'd probably see more willingness. It could be more important than the money."

Fraudulent Behavior

The argument surrounding this Bankruptcy issue in Mildura that some come up with is that this variation will only invite fraudulent behavior opening pandora's box in a manner of speaking for the unscrupulous to maltreatment of the bankruptcy system. We have taken a look at the minimum, but on the other side of the issue, The government is not proposing to change the maximum term of 8 years if it deems a bankrupt has acted in an unethical or fraudulent way, and there are no propositions to change the repercussions of misrepresenting yourself or financial position when filing for bankruptcy in Australia.

As an insolvency professional in Mildura, I have a fair share of experience when it comes to Bankruptcy. And having dealt with countless bankruptcy cases in Mildura I have never uncovered someone abusing the system or acting in a reckless way as to exploit the bankruptcy laws in Australia. When it comes to Bankruptcy, each week I help a small business owner or entrepreneur go through the very tough task of bankruptcy, not once have I thought they are happy about it. The average small business owner or entrepreneur in Mildura does not start out taking enormous financial risks with the intention to fail. The media loves citing the apparent misuse that will be rampant if these changes occur, what a joke!

A Win for Small Business

These recommended changes will be good for often the best and brightest in Mildura not get kicked out of the game financially for financial decisions often outside of their control. Most small business owners I help with Bankruptcy, are hardworking, tax paying, managers keeping this country going.

Truth be told there is a fine line with what the government is trying to do here, because they are trying to balance helping people who have made decisions out of their control, and discouraging people from making errors that land them in trouble and consequently an issue of Bankruptcy. However you likewise don't want to kill the experience and knowledge that business owners have. You undoubtedly don't want to shatter people simply because they have had a sincere failure in a large or small start-up enterprise that has not gone well.

At the big end of town large well established companies have long been criticised for their failure to innovate - lets face it they would be more likely to do so if the risks of insolvency were cut down because directors are concerned they'll be personally responsible in an insolvency arrangement if the new venture doesn't work out.

The government's proposed 'safe haven' modifications for directors of companies will allow Australia to more fully explore and innovate, which will make big updates for Bankruptcy. I can not imagine, that these adjustments will be harmful to Australia's economy, in fact these bankruptcy laws will save the tax payer in all areas of health - Especially in the mental health field because the emotional cost of bankruptcy is substantial. When it comes to Bankruptcy in Mildura not a day passes where I don't hear the tragic experiences of relationship failures, thoughts of suicide and the list continues.

Bankruptcy helps save lives, and it could save yours. If you really need some help with your debts in Mildura or are just thinking about Bankruptcy, feel free to contact us here at Bankruptcy Experts Mildura on 1300 795 575, or visit our website:bankruptcyexpertsmildura.com.au

Bankruptcy in Mildura - does it matter if it is voluntary?

When it comes to Bankruptcy Mildura, often people aren't aware that there are both voluntary, and involuntary bankruptcy - both of these have different approaches and policies.

Involuntary bankruptcy arises when a person you owe money to applies to the court to declare you bankrupt. Normally when you get one of these notices, you have 21 days to pay all the debt. If you don't, then the creditor returns to the court and asks the court to provide a sequestration order that declares you bankrupt. A trustee is assigned, and then you have 14 days to get the documentation in and afterwards you are bankrupt.

You can object to a bankruptcy notice by going to court following the 21 days have expired and put your case forward, to prevent it going to the next level. Other than the way you became bankrupt there is in fact no distinction between Involuntary Bankruptcy and or Voluntary Bankruptcy - once you are simply declared bankrupt, they're managed to in the same way.

However, when it comes to Bankruptcy for this, the stress and anxiety, torment and fear that accompanies this process is incredible. If you think you are probable to be made bankrupt by someone, get some tips and act on that advice. Generally I've found it's always more ideal to know what you can and can't do before you have someone bankrupt you. Once you are bankrupt, it's usually too late.

Voluntary Bankruptcy

Nevertheless, when it comes to Bankruptcy, sometimes there are moments that it is the most ideal option. So you may have to ask yourself, 'when should I consider voluntary Bankruptcy?'.

This question is not the very same for each person of course, but commonly I find that one way you could work it out is to figure out just how long it will take you to pay each of your debts - if its longer than 3 years (the period you are declared bankrupt), then this may assist you make that decision, and help you to understand Bankruptcy.

Once, I had an 80 year old pensioner, who spoke to me once regarding * Bankrupcty tell me that her credit card statement calculated how long her debt would take to pay at the level she was paying off her account, and it was 35 years! Imagine 35 years for one credit card bill.

Credit rating damage can really help you think this through. If you move house and overlook to pay your $30 phone bill for 6 months more, it's very likely the phone service will default your credit file. That default will sit on your file for 5 years, so for $30 you can have your credit file very seriously damaged for that period of time - and all of this will impact how you have to approach Bankruptcy.

In many ways, the ease with which companies/credit providers can default your credit file is unfair. The punishment doesn't seem to match the crime in my book. So if you actually have defaults on your credit report for 5 years, remember that bankruptcy is on your credit file for a total 7 years then its erased completely.

So if your credit rating is a big element in trying to decide whether to take part in a Debt Agreement or Personal Insolvency Agreement or Bankruptcy remember they will all sit on your credit file for a total of 7 years. The biggest contrast is that with a DA or PIA you pay back the money and nevertheless have it on your file for 7 years.

Bankruptcy

I have mentioned the word a few times now, but when it comes down to it, Bankruptcy is the biggest part, and the part most people are afraid of when they come to me to go over their financial situation and Bankruptcy. The other side of crime and punishment equation is bankruptcy, and in this specific country the arrangements are very generous: you can go bankrupt owing millions of dollars and after 3 years it's all finished with no strings attached. Compared to countries like the United States, our bankruptcy laws are extremely reasonable.

I don't pretend to know why that is but a few hundred years ago debtors went to prison. These days I suppose the government believes the sooner it can get you back on your feet working and paying tax, the better. It makes more sense than locking you up which in turn costs the taxpayer anyway.

Bankruptcy wipes every one of your debts including ATO debts except for a few things:

·         Centrelink Debts, Court Fines like parking and speeding fines.

·         HECS or Fee Help loans.

·         Money to take care of a car accident if the car was not insured.

There is much more that can be said about doing this and Bankruptcy in general but the objective of this blog was to help you decide between a few possible options. When getting some advice, don't forget that there are always alternatives when it involves Bankruptcy in Mildura, so do some legwork, and Good luck!

If you want to learn more about exactly what to do, where to turn and what questions to ask about Bankruptcy, then feel free to speak to Bankruptcy Experts Mildura on 1300 795 575, or visit our website:bankruptcyexpertsMildura.com.au.