Similar to a debt agreement, a personal insolvency agreement consolidates all of your debts into a single package. Personal Insolvency Agreements have no limits on income, debts, or assets, making them ideal for high-income earners.
Under a personal insolvency agreement, any interest on the debt is frozen and the amount you pay is based on what you can afford. Creditors can’t contact you or take any legal action against you once the agreement is in place.
If you don’t meet the criteria for a debt agreement and you don’t want to consider bankruptcy, a personal insolvency agreement may suit you.
There are four steps:
Once the agreement is drawn up, a meeting of creditors is called, where relevant parties are invited to vote on the agreement. The terms of the insolvency agreement become legally binding when a majority of creditors voting, agree to it.
NB: Registered Trustees administer personal insolvency agreements.
Personal insolvency is just one option in a range of debt solutions. For an overview on the options available, look here. You must determine whether the information is appropriate in terms of your particular circumstances.
Want to know more about personal insolvency or other solutions? Talk to us, and we’ll take you through your options. We’re experts in finding the right debt solutions for people who are experiencing difficulty with their debts.
Correct at the time of uploading on 24/06/2019.