Rejected Debt Agreements

My debt agreement has been rejected. What should I do?

We believe that everyone deserves a second chance at getting their debt under control. If your debt agreement has been rejected, you still have options. 

A debt agreement is known as Part IX or Part 9 of the Bankruptcy Act, and it’s an effective way to get out from under debt. That being said, your debt agreement proposal could be rejected, and you’ll then need to assess your options.

Debt Busters can help you re-submit your debt agreement to your creditors, giving you a second chance at financial freedom. Have a look below to see how we can help you today.


  • Why Are Part 9 Debt Agreement Proposals Rejected?

    The Australian Financial Security Authority (AFSA) does not have to accept your debt agreement proposal. There are eligibility requirements, and AFSA will assess your individual proposal to see if it meets these requirements.

    In addition, your proposal needs to be decided that it’s in the best interest of the creditors. As soon as your proposal has been processed, your creditors will have 35 calendar days to vote on the proposal. The final day of this timeline is known as the deadline date, and all your creditors for your unsecured debt have the right to vote.

    There needs to be a “majority in value” vote in favor of the proposal in order for it to be approved. In other words, 50.01% of the dollar amount of creditors who choose to vote need to accept the proposal in order for it to be accepted.

    A debt agreement is just that — a mutual agreement between you and your creditors. Occasionally, the repayment terms won’t be considered sufficient for the creditors, and your proposal will be rejected. In this case, you’ll need to resubmit a new proposal based on this feedback.

  • What Happens If My Debt Agreement Proposal Was Rejected?

    Even if your debt agreement proposal was rejected in the past, it is still possible to submit a new proposal. If your information has changed, your creditors might reconsider the situation.

    What exactly happens if your debt agreement proposal is rejected?

    • Both you and your creditors will be notified
    • If your debt is above $5,000, your creditors can apply to make you bankrupt as a way to recover your debts
    • Your outcome will be listed on the National Personal Insolvency Index and it will stay for 12 months if rejected


    If you find yourself in this situation, don’t fret. You still have options. The experts at Debt Busters can take a look into your unique situation. Then, you’ll know if a new proposal with us would be successful.

  • How Do I Resubmit A New Debt Proposal?

    If your situation has changed in any way, you’re eligible to reapply for a debt agreement. At Debt Busters, we have long-standing relationships with creditors. Our positive reputation and experience give you a fighting chance even if your initial proposal was rejected.

    We will act as your new Debt Agreement Administrator. This means Debt Busters will leverage our respected position to ask your creditors to reconsider your debt agreement proposal. You can spend less time worrying and more time making a change. Contact us today to get the process started.

  • Is A Debt Agreement the Same As Going Bankrupt?

    Debt Agreements are administered in accordance with Part 9 of the Bankruptcy Act, but they’re not considered the same as going bankrupt. When you submit a proposal, you are committing what’s known as an “act of bankruptcy”.

    Simply put, when you submit a debt agreement proposal, you’re acknowledging that you can no longer afford to pay your debts. This means if your proposal is rejected, your creditors have the ability to use your proposal to apply to the court to make you bankrupt.

    Because it’s usually in your best interest to avoid bankruptcy, it’s important you act fast by talking to a financial professional about your options. While a debt agreement isn’t the same as going bankrupt, it can quickly change if your proposal is not accepted.

  • What Are The Benefits Of A Debt Agreement?

    Why should you continue to submit your debt agreement instead of another debt alternative? There are a number of benefits that come along with a debt agreement that you won’t get with other types of debt solutions. Here are the most common benefits:

    • More Control – First, if your proposal is accepted, you’ll have a budgeted amount you need to pay each week, fortnight, or month. Usually, this is lower than you would have paid without an agreement, making it more affordable.
    • Pay Your Debt – Once you’ve finished your agreement term, you’ll finally be free from most, if not all, of your unsecured debt. This is the most harmful type of debt, and it’s important to pay it off as quickly as possible.
    • Frozen Interest – Last but not least, when you enter a debt agreement, your interest on your debts is frozen. This means you don’t have to worry about not paying down your balance effectively.

     

    Even if your debt agreement proposal was rejected, don’t lose hope. You can still achieve all of these benefits above by enlisting the help of a qualified debt professional. The experts at Debt Busters have over 10 years of experience helping Australians of all backgrounds overcome their debt once and for all.

  • How Can Debt Busters Get Me A Different Result?

    The administrator you choose can have a big impact on your debt agreement outcome. Debt Busters has extensive experience preparing debt agreement proposals. Creditors know and trust us, and this gives us the credibility needed to re-propose your previously rejected Debt Agreement Proposal. There is no guarantee, however, you will get a second chance to pay off your debt with one simple affordable repayment.

    With over 10 years of experience, Debt Busters have built a highly respected reputation in the credit and debt agreement industry. We’ve been assisting our clients with debt relief solutions and our experience is reassuring to both clients and creditors.

    Don’t stress if your debt agreement has been rejected. Let the experienced team at Debt Busters help you today. Request a call now and we’ll be in touch shortly with an array of helpful debt agreement advice and solutions.

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Debt Busters is an Australian owned business which was founded in 2005 - since then we have been able to help thousands regain financial control.

Debt Busters prides itself on providing a dedicated Client Service Manager to work closer with you and provide a higher level of customised service about your situation.