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Patrick H.
Patrick H., Lawyer
Category: Australia Law
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Experience:  Dip Law LPAB - Sydney based lawyer
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, I have debt of over 36000 in new zealand and I live

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Customer: I have debt of over 36000 in new zealand and I live in australia now.. and I received a letter from debt collection from new zealand from a sister concern company in australia to pay the money off.. what are my options
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Submitted: 11 months ago.
Category: Australia Law
Expert:  Patrick H. replied 11 months ago.

Hello and thank you for your question.

Your NZ debts can be recoverd by your creditors in Australia, and although recovering foreign debts is typically much more expensive, that issue is largely negated if the creditor has offices in Australia.

If you cannot afford to repay the debt, then you have the following options:

- ignore your creditors and hope that they decide not to bother pursuing you. However, a debt of $36,000 is unlikely to be abandoned so I would not recommend this approach;

- if you cannot afford to repay the debt, you could apply for voluntary bankruptcy, in which case all your debts will ordinarily be legally discharged after 3 years (though you would still have to pay out what you reasonably could, and all your existing assets would need to be liquidated), and if this is an option you would seriously consider, I suggest you read more on bankruptcy and its consequences here: https://www.afsa.gov.au/debtors/bankruptcy/consequences-of-bankruptcy.

- simply repay the debt and get your creditor off your back. If you do so I would suggest you agree to pay the outstanding amount subject to your creditor acknowledging in writing that such payment will finalise all claims which they may have against you, so as to prevent them later asserting that there is unpaid interest on the debt that is still outstanding, etc.

- finally, you could try to negotiate a repayment arrangement on more favourable terms than simply paying them the full amount. For example, you could offer to pay by way of installments at a rate that is manageable to you, or to pay a reduced amount in full settlement (it costs creditors money to chase debts so if you agree to pay them a lesser amount and can prove you are unable to pay the full debt, they will often accept such an arrangement. Again this should always be done on the basis that the agreed new arrangement is in FULL settlement, otherwise they may try to claim the balance later, or later chase you for interest on the debt. Often it is best to let a lawyer, or other financial adviser negotiate such arrangements for you.

There are also personal advice services available which can review your situation more closely and provide advice on budgeting or negotiating with your creditor, and the following link may assist:

https://www.afsa.gov.au/debtors/your-options/get-help/getting-help

I trust the above assists.

Good luck and PLEASE RATE MY ANSWER.

Patrick

Customer: replied 11 months ago.
I just received a letter from the deb collection agency in auckland and they have they branch in sydney and they have sent the letter to repay the debt. What are my options if I dont have a job now or dont have any asset here in australia or nz ... will they still chase me. I dont have any work.. has been looking for work for a while. Will they be able to take me to australian court if yes how long does it take....
Expert:  Patrick H. replied 11 months ago.

They can ultimately bankrupt you, at which point you will be subject to the same situation as a voluntary bankruptcy. The whole process can take from a few months to a year to initiate bankrutcy.

The fact you currently have no capacity to pay does not mean you cannot try to negotiate with them for a much reduced repayment arrangement. They cannot get money you do not have, so if you negotiate with them and can show your lack of capacity, they may well accept something much reduced on what they are claiming. I would refer you to my previous answer and strongly suggest you try to find an organisation which can help you negotiate a suitable compromise repayment arrangement. Even if you have to pay for such assistance, where you are faced with bankruptcy, the money you spend in seeking such assistance will simply reduce what the creditor will otherwise recover if you don't get that advice.

Good luck,

Patrick

PLEASE RATE MY ANSWER.

Customer: replied 11 months ago.
Will they bankrupt me in New Zealand or Australia. Or which country do I need to file bankruptycy.. I will seek an individual opining but please can you let me know which country they will bankrupt me on..
Expert:  Patrick H. replied 11 months ago.

They can bankrupt you in both countries.

Bankruptcy in Australia only discharges your debts under Australian law. If you are worried about being pursued for debts in another country you would need to apply for bankruptcy there (or whatever process such other country has for resolving debt issues (all countries have their own laws dealing with such matters, though NZ has very similar laws to Australia on such matters but only a local lawyer can tell you how to deal with your debts in NZ). If you intend to make yourself bankrupt voluntarily the relevant jurisdiction to consider is where you have assets and where you will be working, as it is that jurisdiction in which your debts will ultimately be pursued.

PLEASE RATE MY ANSWER.

Patrick

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