The Official Assignee administrates a pre-bankruptcy program known as the Debt Repayment Scheme (abbreviated as “DRS”). Know more about repayment assistance plan.
It works toward a resolution that will be beneficial to the creditor as well as the debtor. Debtors whose total unsecured debts do not exceed $150,000 will have the opportunity to negotiate a debt repayment plan (also known as a “DRP”) with their creditors via the DRS. This will allow them to escape bankruptcy’s constraints and social shame.
The DRP being suggested has to ensure that the interests of the creditors are protected sufficiently. These debtors have agreed to participate in the DRP and will repay their obligations over a predetermined period that will not exceed five years. After the debtor has fulfilled all of his financial commitments following the DRS, he will be freed from all of his debts and will be able to begin life over.
A pre-bankruptcy program known as the Debt Repayment Scheme (DRS) is overseen by the Official Assignee (OA). When a debtor is successfully put on DRS, they can escape the constraints and social shame of filing for bankruptcy. After agreeing to the conditions of the DRS and agreeing to make payments to reimburse creditors following a repayment plan that extends over just not more than five years, the debtor has the chance to begin a new financial life with a clean slate.
For the debtor to be qualified, they need to satisfy all of the following criteria:
- the aggregate amount of obligations does not go over $150,000;
- actively engaged in profitable work and producing consistent revenue;
- You must not have filed for bankruptcy or been placed on the DRS in the previous five years;
- You must not have been the subject of a court-based agreement in the preceding five years; and
- Not a single owner of any business nor a partner in any company.
What is Bankruptcy
A person is considered to be in a state of bankruptcy when the High Court determines that they cannot repay debts totaling more than $15,000 and that the individual should be classified as bankrupt. When a person declares bankruptcy, the High Court will often appoint an Official Assignee to manage the bankrupt person’s business affairs. These include registering the creditor’s claims, the distribution of dividends to the bankrupt’s creditors, and selling the bankrupt’s assets to satisfy his creditors.