Upcoming changes to debt agreements

From 27 June 2019 there are several changes being made to how debt agreements work. What’s changing?

  • You can no longer propose to administer your own debt agreement or use an unregistered debt agreement administrator.

These types of debt agreements that commenced prior to 27 June 2019 will automatically transfer to the Official Trustee (AFSA) on 27 September 2019. If you don’t want AFSA to manage your debt agreement, you need to select a registered debt administrator or registered trustee.

To do this, complete a variation proposal on Debt agreements online before 27 September 2019.

  • You will only be able to propose a debt agreement for up to three years, or if you own your home for up to five years.
  • You must use a registered debt administrator or a registered trustee to administer your debt agreement (you can no longer self-administer your own debt agreement).

If you are currently in a debt agreement most of these changes won’t affect you

My debt agreement was accepted

Once your creditors have accepted your debt agreement, you and your creditors are bound by the terms of that agreement. This means:

  • Your debt agreement administrator manages your payments to creditors.
  • Your unsecured creditors can no longer contact you about the debts that you've included in the agreement.
  • If creditors are still contacting you about a debt, advise them of your AFSA administration number[?] and start date.
  • Creditors are no longer able to add any interest to the debts.
  • Creditors are still able to repossess secured goods (e.g. house or car) if you can’t keeping making repayments.

My personal insolvency agreement was accepted – what happens now?

Once your creditors have accepted your PIA, you and your unsecured creditors are bound by the terms of that agreement. This means:

  • A trustee is appointed to carry out the terms of your PIA.
  • Your trustee may sell your assets and collect payments from you or others to help pay your debts.
  • Your agreement will determine your obligations.
  • Your unsecured creditors should no longer contact you about the debts that you've included in the agreement.
  • If creditors are still contacting you about a debt, advise them of your AFSA administration number[?] and start date.
  • Normally, the PIA will not affect secured creditors. Secured creditors may still able to repossess secured goods (e.g. house or car) if you can't keep making repayments.