Filing for bankruptcy should always be considered as the last resort if you are overwhelmed with unsecured debt. Before making a potentially life changing decision, we will carefully go through all of your options to see if you can avoid bankruptcy.  The options we will explore include:

Informal Arrangements
An informal debt arrangement can be negotiated directly between you and your creditors to manage your unsecured debt. These arrangements might include, for example, a suspension of repayments for a period of time, or agreed regular installments.
The only drawback to this arrangement is that the agreement is not legally binding on your creditors, which means they can change their mind if you do not keep up with your promised repayments.  Typically this can then lead to creditors adopting a more aggressive approach which may include bankruptcy proceedings.
Informal arrangements can be negotiated with or without the assistance of an Insolvency Practitioner.
Part IX Debt Agreement
A Debt Agreement is a legally binding arrangement negotiated between you and your creditors usually with the assistance of a Debt Agreement Administrator. This arrangement will often take the form of an agreed sum paid in installments (usually over three to five years). The interest on your debts will be frozen at the time you lodge your proposal with AFSA.
Entering into a formal debt agreement means that you will be protected from any creditors who may have threatened bankruptcy proceedings.
You need to be aware of the consequences of proposing or entering into a Debt Agreement and these are explained in our related article.
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Part X Personal Insolvency Agreement
If your debt exceeds the Debt Agreement Thresholds but you wish to deal with your debt by way of a formal agreement with your creditors, you may wish to enter into a Personal Insolvency Agreement (PIA).
A PIA works in much the same way as a Debt Agreement, ie it must first be approved by your creditors. The key difference is that entering into a PIA requires you to appoint a Controlling Trustee to take control of your assets and report your proposal to creditors and hold a meeting of your creditors. For this reason, a PIA usually costs more than a Debt Agreement.
If you want to explore your options on how to legally avoid bankruptcy, then call us today on 1800 462 767 for free and impartial advice.