All unsecured creditors are bound by the Debt Agreement and are paid in proportion to their debts.
You are released from most unsecured debts when you complete all your obligations and payments.
Secured
creditors may seize and sell any assets (eg a house) which you
have offered as security for credit if you are in default.
Creditors cannot take any action against the your property to collect their debts.
The agreement does not release another person from a debt jointly owed with you.
A
debtor who proposes a Debt Agreement commits an act of bankruptcy. A
creditor can use this to apply to a court to make the debtor bankrupt if
the proposal is not accepted by creditors.
The
debtor's name and other details appear on the National Personal
Insolvency Index (NPII), a public record, for the proposal and any debt
agreement.
The
ability of the debtor to obtain further credit is affected. Details may
also appear on a credit reporting organisation's records for up to
seven years.
During
the voting period creditors cannot take debt recovery action of enforce
a remedy against you or your property and must suspend
deductions by garnishee on your income.
