Advantages and Disadvantages of a Debt Agreement

Here we take a look at the advantages as well as the disadvantages of a debt agreement. We will always disclose to you the truth about a Debt Agreement. Whilst they have tremendous advantages for those people who are eligible, you also need to consider and understand the disadvantages of a debt agreement. For more information you can always call and discuss advantages and disadvantages of a debt agreement with our debt consultants. Our consultants are highly trained debt specialists. Call us today on 1800 98 10 70



  • All current or pending legal action against you will be frozen as soon as your proposal is accepted for processing by AFSA. Even future legal action from your existing creditors will be frozen as soon as your proposal has been accepted by AFSA for processing. This freeze will remain in place as long as your proposal is accepted by your creditors.
  • Secured creditors are unaffected by the agreement so you can keep any leased assets (ie your car) and also keep your house as long as full disclosure is made.
  • A debt agreement follows the concept of debt consolidation, ie a debt agreement (once approved by your creditors) bundles all the existing debt and becomes payable over the course of the debt agreement by the agreed installments. The agreed installments are paid to the appointed debt agreement administrator. The benefits of this are similar to the benefits of debt consolidation
  • Many of the restrictions placed on you by bankruptcy, such as restrictions on travel and the ability to retain or acquire property, do not apply to debt agreements.


  • Some of your personal details, including your name, will be recorded on the National Personal Insolvency index, known as the NPII. These records are recorded indefinitely. These details are available to anyone who can access the NPII after paying a fee.
  • Your credit rating will be affected, with your name and some details being recorded on consumer credit databases. This means that you may have some difficulty in obtaining a loan, however, we find that once you have successfully completed your debt agreement you should be able to obtain a loan (subject to lending criteria).

If you are struggling with unsecured debt, we believe that the advantages of a debt agreement outweigh the disadvantages. Consult with our expert debt consultants today.