If you’re struggling with judgement debt, then let’s look at some good options that can help you during these difficult times.
You’re probably doing it tough right now like many families in Australia. The financial burdens have taken its toll on your life and you might have been served a notice to attend court.
We’ll help you understand what are judgement debts and what you can do about it. The Debt-Free Community provides free advice online.
We firstly recommend you talk to a qualified legal and/or financial advisor who can help you personally during these challenging times.
The advice we provide here is very general in nature and isn’t legal advice.
Judgement debts Australia
In Australia, there are occasional situations where you might be served a judgement debt. They will need to be served to you in person by a Sheriff.
So, what are Judgement debts?
In short, Australian judgement debts are where you’ve been taken to court and they have decided that you definitely owe the debt collector money. Now you need to cough up money for them otherwise there are severe penalties if you ignore this. Treat this as very serious.
You have or about to have the above situation take place. This is an official situation where you are being summoned to court.
From some demanding letters and phone calls to this. Now you can’t escape.
Ignoring the judgement situation
We don’t recommend that you ignore the severity of the situation here.
Such issues can arise which include:
- The Bailiff can force entry into your shed or garage to take or sell some of your personal stuff (excluding bedroom or kitchen furniture, tools of trade (up to $500) or stuff which isn’t yours). Imagine arriving home one day to see your garage is completely empty!
- They can serve a Garnishee Order where your weekly pay which would normally go into your bank account instead goes into the account of your debt collector. This can leave you with such little funds to live on.
- They can order the sale of your property if the debt is more than $3,000.
- Creditors can apply to Australia’s Federal Court and have you declared bankrupt if the judgement debt is greater than $2,000. That’s scary!
- You might receive an examination summons where you have to go to court and explain your income and assets. If you don’t show up, then guess what? The police can drag you to court.
Those are indeed serious consequences if you ignore the severity of the situation. Judgement debts aren’t your debt collectors simply calling you up day and night. The collection activities have moved way past this and you need to do something now.
Settling the judgement debt
There are ways out of this mess. The National Debt Helpline can help you with professional help on 1800 007 007 if you want some assistance here.
A good option sometimes is to owe up to the Local Court that you indeed owe some money. It’s an easy option and you can ask to pay the collector by instalments. It’s likely that you’ll need to supply details of income and assets.
If they agree, then you need to keep up with the agreed payments. Remember: They gave you a chance and it’s them doing you a favour, not the other way around. You will still have additional interest charged on the debt, but this beats going bankrupt. You’ll probably have additional legal fees to pay too.
Some people have other debts which put them into challenging times. If this is you, then look at some options which The Debt-Free Community talks about. You might want to contact us to look through options available today.
Regardless, there is a strong likelihood that this will affect your credit rating in Australia. Right now, that’s not that important. Taking action and doing something about this is important and you need to pull your finger out.
Judgement debts: In summary
We wouldn’t recommend you ignore this as it’s a legal process you’ve now entered into. Police involvement is something that can and might happen, including arrest at your house or workplace.
You don’t need to deal with that stress. Work out a payment plan with the debt collector and stick to it. They’re probably giving you the last chance that they can.