We can still apply to a specialized lender and help you borrow up to 95% of the value of the property, but the maximum credit size is 650,000 USD. It is an agreement between you and your creditors, that is, to whom you owe money. While COVID-19 has posed a number of economic challenges, there is one area where Australians have advantages – with investment credits now cheaper than ever. If you are unable to pay your debts, you may want to consider bankruptcy or an alternative to bankruptcy called a “debt agreement.” These will be formal legal options available under the Bankruptcy Act 1966. There`s nothing stopping you from applying for a loan or credit card while you have a debt agreement, but you may not have the success you`re hoping for. In most cases, you do not have the primary or current credit interest rates directly after payment of a Part IX debt agreement. It is very likely that you will only have access to bad credit or subprime interest rates. The advantage is that you can be the first to use this on the scale to get good credit and a better trading position in the future. Being bankrupt and being under a debt agreement are two different things.
It is important to understand the differences and commonalities. If you want to apply for a home loan after your debt agreement is concluded, you must first apply for a loan from a subprime lender at a higher interest rate. The long-term goal would be to refinance with a mainstream lender at a better interest rate once your bad creditworthiness has been corrected.