Bankruptcy occurs when someone has a declining financial situation resulting from debts and arrears that they are unable to pay as and when they fall due, and for them often the best solution is to file for bankruptcy.

Through the natural course of bankruptcy, a trustee will be appointed which over the 3 years will realise all assets and resources as well as all creditors and arrears of debts. The trustee will then liquidate the estate in order to distribute the liquidated assets amongst creditors, in a way that is proportionate to the debts owed by the bankrupt – i.e. the creditors with the greatest amount owed to them should receive the highest proportion of any funds recovered.

Fortunately there are provisions within the Bankruptcy Act that enable bankrupt to have their bankruptcy annulled through a Section 73 proposal.

The repercussions of creditor’s claims can often result in bankruptcy, regardless of whether or not it was the individual’s choice to enter bankruptcy, or if it was filed by a creditor. However, bankruptcy is far from the end of the world for the person who undergoes bankruptcy.

At Personal Bankruptcy Gold Coast we can utilise mechanisms within the Bankruptcy Act which allow for the annulment of bankruptcy through the provisions of Section 73, which have the same effect as if the bankruptcy had never occurred. This gives the individual an opportunity to have a ‘clean slate’, free from all debts accrued the time of bankruptcy.