When declaring bankruptcy, you are appointed a trustee. The trustee is the organisation or company handles your bankruptcy estate. It is their job the collect any funds that are claimable and distribute them amongst your creditors. There are specific thresholds that exist, and if those thresholds are breached, then the trustee will move to sell an asset you may own, or collect funds on the creditors behalf.
Examples of things the trustee may collect include vehicles or equity in vehicles over $7800, income over the income threshold, tools of trade over a certain value, large amounts of cash, property or items of value other than household items or furniture.
A more detailed list of thresholds and items can be found at the Australian Financial Security Authority’s website. This list indexes every year, meaning they are changed in line with the Consumer Price Index or the base pension rate, so it is important to keep up to date with the amounts.
99% of the bankruptcy cases we put through at Safehaven Debt Services end up with AFSA being the trustee. The Australian Financial Security Authority, or AFSA, is the official trustee, and there are many benefits associated with having them as your trustee.
The primary benefit is the ease with which you can update your details and communicate with them. Most correspondence can be online via their website, but we can help with any issue you have if need be.
Many people believe there is a benefit to appointing a private trustee, as they believe they will be ‘friendly’. There are some cases where a private trustee is beneficial, but in order to see those benefits you would need to have a very large bankruptcy estate, with a number of properties to sell, companies to wind up and a large pool of assets to be sold.
The vast majority of clients we help do not require a private trustee, and by appointing one, they would be incurring a cost for a service they do not require.
If you are looking for further information on what assets you can keep, or how your relationship with the trustee may look, feel free to give us a call. We can discuss your situation, and give you an idea of how bankruptcy will look for you moving forward.