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Benefits and Consequences of a Part 9 Debt Agreement

Benefits:

All interest and charges on your unsecured debts will be frozen.
Providing you keep to the terms of your arrangement, your creditors will not be able to pursue any further court action. They will also be prohibited from sending letters to you and telephoning you for the purpose of debt collection.
Once the Debt Agreement is successfully completed your debts are effectively settled, providing you with a fresh start.
For anyone who does not wish go bankrupt because of their job or the stigma of bankruptcy this can be an excellent option.
The Debt Agreement will bind most unsecured creditors.
Your contributions are based on your ability to pay.
You can keep your secured assets as long as you continue to pay for them
Once there is an agreement in place, the amounts owed to creditors does not change

Consequences:

You will be required to stick to a budget for the term of the agreement.
It’s a requirement that all assets and liabilities are declared
Debt Agreements are recorded on a public register and are likely to appear on your credit file. This in turn may affect you ability to obtain credit.
For further information, please refer to the following links to ITSA – the government department that overseas the Part 9 Debt Agreement Scheme: http://www.itsa.gov.au/