What is a Debt Negotiation?
A Debt Negotiation is set up between you and your creditors allowing you to repay a affordable amount of your debt with minimal lasting consequences.
Unlike a formal Debt Agreement, a Debt Negotiation is not a FORMAL AGREEMENT which won’t impact negatively on your credit rating and allows you certain financial freedoms you would otherwise be denied by entering a Debt Agreement or declaring formal bankruptcy. Once you have entered an Debt Negotiation those harassing phone calls from collectors and creditors will cease and you will be free to pay off your debt in peace.
Entering an Debt Negotiation is simple. We will look at your current financial situation (income and outgoings) and go through all solutions that you qualify for. We want you to see if an formal or non-formal agreement is right for you. Not everyone is suited for an Debt Negotiation. The main requirement is that you can afford to pay the agreed amount on a weekly basis. Our team and partners will work with your creditors to come up with a realistic, achievable and sustainable repayment plan.
The repayment amount will be calculated according to your income, cost of living and debts and what you can afford. Often, this can mean you are only repaying a percentage of every dollar you owe with all future interest frozen so you can repay your debt quickly and stress free.
This is a pro-active solution set up between you and your creditors allowing you to repay your debts, take control of your life and gain financial freedom.
Types of Solutions in Debt Negotiation
A Debt Negotiation doesn’t have to be an ongoing payment arrangement. Our team and partners of professional debt negotiators can also arrange a lump sum debt settlement, a loan negotiation or a debt settlement. The type of solution used will depend entirely upon your debts, your budget and your financial position both now and into the future. Types of Debt Negotiation Solutions include:
- Long Term Informal Agreement: this arrangement reduces the minimum repayments, freezes or significantly reduces interest, has no ‘typical’ term but may be several years and in many cases even reduces the principal debt amount.
- Moratorium: a short-term arrangement which freezes or significantly reduces repayments and interest over a period of up to 12 months.
- Debt Settlement: is designed to waiver, reduce debt or negotiate a single lump sum payment to settle outstanding debts.
- Agribusiness: is a specific agreement to manage individuals caught up in failed agribusiness loan schemes. This could be a single lump-sum payment, a moratorium or long term payment arrangement, depending on the individual’s financial capacity.
- Loan renegotiation: is a negotiation of current loan terms and conditions to reduce their minimum loan repayments or interest rate.
Please note: Armada Advisory prefer to place clients in a formal solution (Debt Agreement) due to the protection provided by government legislation. A Debt Negotiation is a personal preference for the client or if the client does not meet the criteria for the formal solution.
A Debt Negotiation is not protected by government legislation and once agreed and started becomes the responsibility of the client. If you miss one payment in a Debt Negotiation your creditors can terminate the arrangement. In a Debt Agreement (Formal Solution) you are protected for a period of missed payments (26 consecutive weeks) which will NOT terminate the Debt Agreement.
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