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Debt Agreement

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Debt Agreements (DA) combine all of your unsecured debt repayments into one regular payment amount based on your budget.

A Debt Agreement is not a loan. Solutions2Debt will put in place legal agreements with all the creditors in the DA and manage them on your behalf. Once the DA is in place you’ll receive no more contact from your creditors and deal only with Solutions2Debt.

If you find that you cannot afford to repay your debts as they fall due, a Debt Agreement may be a great option for you.

Advantages of a Debt Agreement

  • No interest
  • One regular payment
  • All debts included in the agreement will stop accruing interest
  • Legal action stops, including garnishees
  • Creditors no longer contact you, including Debt Collectors
  • DA’s provide the protection of a formal agreement
  • Payments are based on your budget


To be eligible for a Debt Agreement, the following criteria must be met:

  1. You cannot afford to repay your debts as they are due.
  2. Your take-home pay (after tax income) of under $86,800.35 annually.
  3. Your unsecured debts must not exceed $115,733.80.
  4. You must not have been bankrupt, been a party to a debt agreement or have given authority under S1888 of the bankruptcy act in the last 10 years.
  5. Any assets you own must not be worth more than $115,733.80.

Things You Should Know

  • Entering a Debt Agreement is an ‘act of bankruptcy’ (not to be confused with bankruptcy). In the event a proposal is not accepted by creditors, a creditor can use this to apply to court to make you bankrupt.
  • Information about your debt agreement will be recorded on the National Personal Insolvency Index (NPII) for a limited time.  When your debt agreement has been completed, the NPII notation will be removed, no sooner than five years from the date the debt agreement commenced.
  • The ability to obtain further credit is affected.  Details may also appear on a credit reporting agency’s records for up to 5 years, or longer in some circumstances.
  • During the voting period, creditors cannot take debt recovery action
  • All unsecured creditors are bound by the Debt Agreement and are paid in proportion to the debts owed to them.
  • If the terms of the agreement are not met, creditors can recommence recovery action for those debts contained in the debt agreement. This will include interest backdated to the start of the agreement.  However, before an agreement is terminated, Solutions2Debt may request a ‘variation’ to the original agreement that more meets your current/changed affordability level, so that the agreement can continue potentially with reduced payments.
  • You are released from most unsecured debts when they complete all their obligations and payments.
  • Secured creditors may seize and sell any assets (eg a house) which you have offered as security for credit if you are in default.
  • Unsecured creditors cannot take any action against you or property of the debtor to collect their debts.
  • The agreement does not release another person from a debt jointly owed with the debtor.
  • A debtor must disclose that s/he is a party to a Debt Agreement if incurring debt or obtaining goods and services in excess of the threshold.
  • If trading under a business name or assumed name (whether alone or in partnership) the Debt Agreement must be disclosed to all people dealing with the business.
  • If operating a sole trader business while in a Debt Agreement, you must include your full name in the business name; e.g. John Smith trading as Acme.

Thousands of Australians use a Debt Agreement as a way to resolve their unmanageable debt every year.

If you would like to find out if a Debt Agreement is right for you, please contact one of our experienced debt consultants on 1300 871 096 today.


Figures on this website may change slightly from time to time. Updated 24/06/2019

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