Increase the threshold for bankruptcy from $5K to $20K
Currently, a debt of just $5000 can allow creditors to bankrupt Australians in financial difficulty. Along the way, charges, trustee fees and other legal fees imposed can add tens or hundreds of thousands of dollars to the initial debt. The threshold, in place since 2010, is far too low and in many cases gives creditors the power to force the sale of the family home to recover what started out as a reasonably small debt to a credit card provider or utility company.
It is unreasonable that people could be at risk of losing their home over a $5,000 debt. Increasing the threshold in the Bankruptcy Act would go some way to restoring balance in the system for the thousands of Australian households struggling with financial pressures.
Policy contact: Cat Newton: 03 8554 6943 – email@example.com
Media contact: Jonathan Brown: 0413 299 567 – firstname.lastname@example.org