Some of the possible consequences of bankruptcy include:
- a trustee in bankruptcy will be appointed to deal with your creditors on your behalf
- some of your possessions, such as a car, boat or motorbike may be sold to pay off your debts
- if you earn over a certain set amount, you may need to make compulsory payments to your trustee to be distributed to your creditors
- there may be restrictions on your employment or whether you can run a business
- there may be restrictions or conditions placed on you if you wish to travel overseas while you are bankrupt
- you will probably find it difficult to obtain credit – credit reporting agencies will keep a record of your bankruptcy for 5 years from the date you became bankrupt, or 2 years from when your bankruptcy ends, whichever is later; and
- your name will permanently appear on the National Personal Insolvency Index.
Bankruptcy is a legal process and comes with some risks if you do not adhere to the laws and processes. Getting professional bankruptcy legal advice can help you achieve the best outcome for you and ensure you are protected.