B. FORMAL ARRANGEMENTS. (5 sections)
The Bankruptcy Act provides formal options for dealing with unmanageable debt. The legislation specifically sets out what you and your creditors can or cannot do under each of these arrangements.
Section 1:
Declaration of intention to present a debtor's petition:
This stops your unsecured creditors garnisheeing your wages and/or the bailiff or sheriff seizing your assets to recover debts for a period of seven days. It does not prevent a secured creditor from repossessing an asset. You could use that time to speak to your creditors, consider other options or seek advice.
You do not have to become bankrupt after this period. You can only lodge one declaration every 12 months.
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