During the voting period creditors cannot take debt recovery action or enforce a remedy against the debtor or the debtor’s property; and must suspend deductions by garnishee on debtor’s income.
A debtor who proposes a debt agreement commits an act of bankruptcy. A creditor can use this to apply to 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.
What are the consequences of a Debt Agreement?
The debtor is not bankrupt.
All unsecured creditors are bound by the debt agreement and are paid in proportion to their debts.
The debtor is released from most unsecured debts when they complete all their obligations and payments.
Creditors cannot take any action against the debtor or property of the debtor to collect their debts.
The agreement does not release another person from a debt jointly owed with the debtor.
A debtor must disclose that s/he is a party to a debt agreement if incurring debt or obtaining goods and services in excess of $5778.00

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