A Personal Insolvency Agreement, also known as a Part X, is a formal agreement one can reach with their creditors when they are facing personal insolvency. A Personal Insolvency Agreement is often seen as a preferred alternative to bankruptcy, as it comes with less severe consequences for the individual.
The purpose of a Personal Insolvency Agreement is to propose a settlement arrangement between the indebted individual and their unsecured creditors. In this arrangement the debtor will make regular repayments that will eventually lead to the creditors receiving a percentage return on their debt. Most creditors are happy for a Personal Insolvency Agreement to last for 3 to 5 years. To begin the Personal Insolvency Agreement process, the individual must appoint themselves a Controlling Trustee.
During the period of the Personal Insolvency Agreement, no creditor is able to commence or force bankruptcy proceedings, or take any other debt recovery action against the individual. All enquiries on the accounts are to be dealt with by the Trustee of the Personal Insolvency Agreement.
For free and confidential advice on Personal Insolvency Agreements, contact CRS Insolvency Services today on 1800 210 073.