Understanding Personal Debt Agreements

Entering a personal debt agreement can be beneficial to your financial situation. There are many pros, as well as cons, to agreeing to the terms of this document. Today, we will talk about what personal debt agreements are, how they work, and other essential details you need to know to help you if you choose to create a personal debt agreement.

What is a Personal Debt Agreement? 

A personal debt agreement is a legally binding agreement between you and the creditors you owe. In these situations, you agree to terms that you have discussed with your creditors. You may negotiate specific terms, pay a percentage of your debt over time, or make repayments to the debt agreement administrator rather than the creditor.

Can the Creditor Request All of the Money? 

If you negotiate on a specific amount of debt paid back, the creditor cannot request additional funds beyond what has been specified in the debt agreement. There are limitations based on your income and the debt owed.

What Do I Need to Do Beforehand?

Before signing a debt agreement or discussing this option, you should consult with experts. Figure out your options, and be sure that a personal debt agreement would be the right decision for you and your family. You should also fully understand the consequences before signing the final document.

Let Debt Free Australia Assist You

For more information about personal debt agreements and how they could benefit your situation, Debt Free Australia is here to help. To contact us regarding our services, contact us either here or through our toll-free hotline at 1800 462 767.