LawAnswers.com.au - Australia's #1 Legal Community

LawAnswers.com.au is a community of 10,000+ Australians, just like you, helping each other.
Ask a question, respond to a question and better understand the law today!
Join us, it only takes a minute:

VIC Debt Incurred by Last Partner - Will They Take Away Assets?

Discussion in 'Debt and Bankruptcy Law Forum' started by Calamity Jane, 6 May 2016.

  1. Calamity Jane

    Calamity Jane Member

    Joined:
    6 May 2016
    Messages:
    2
    Likes Received:
    0
    My son's partner owes her bank 20k from a debt incurred by her last partner who has gone back to his country of birth. She is unable to work due to ongoing mental trauma and my son, who is himself a low-paid worker is desperately trying to help her shoulder this burden.

    Is there anything they can do? If she declares bankruptcy will they take away her only asset - her car? And will my son's assets be confiscated?
     
  2. Victoria S

    Victoria S Well-Known Member

    Joined:
    9 April 2014
    Messages:
    434
    Likes Received:
    42
    Hi Calamity Jane,

    How did she end up owing $20K for someone else's debt? Did she take out a joint loan with her ex or something?

    If she was to file for bankruptcy, she would likely be an undischarged bankrupt for a period of at least 3 years, during which time her trustee in bankruptcy would have control over her assets. A trustee has the power to seize and sell some of your assets however the Bankruptcy Act allows you to keep one vehicle, to be used for transport, which must be worth under a certain amount. If it is over a certain amount then the trustee can sell it and give you back about $6K to buy another car. Also, it is the individual who is bankrupt not the couple. Your son will not be affected by her bankruptcy unless they have joint assets, in which case he will not lose his share in those assets, but her may have to buy out the trustee for her share or sell his share or something to that effect.

    Here is some info on assets you can retain during bankruptcy:
    Bankruptcy and assets - quick guide — Australian Financial Security Authority

    Consider the alternatives to bankruptcy before just diving in, as bankruptcy does have serious long term consequences.
     
  3. Calamity Jane

    Calamity Jane Member

    Joined:
    6 May 2016
    Messages:
    2
    Likes Received:
    0
    They did have a joint account. Just before he left he maxed out her credit card to the tune of 10k then she had to borrow the other 10k to cover the expenses of moving and filing for divorce. What are the long term consequences?
     
  4. Sophea

    Sophea Well-Known Member

    Joined:
    16 April 2014
    Messages:
    2,300
    Likes Received:
    334

Share This Page

Loading...