Skylar and John, a newlywed couple, were happy and healthy with two full-time jobs. Skylar worked as a designer, while John worked in manufacturing. They bought their first house a few years ago and were thinking about having children to expand their family.
A few months ago, John was involved in a medical emergency. He was at home, cooking dinner, when he was rushed to hospital because of a heart attack. After spending months in hospital being monitored, they sent John home. Unfortunately, he was not able to return to work straight away and spent a total of 6 months recovering. With only one income, Skylar and John were struggling to pay for their mortgage and basic living expenses.
While John was in hospital, Skylar took out multiple credit cards thinking they would help ease her financial stress. With the interest rates sky high, after just three months, Skyler was drowning in credit card debt. With limited equity available in the home and not being in a position to sell the family home, refinancing home loan or selling the home was not an option.
Not sure where to turn, Skylar gave us a call. After a free consultation, we determined that a Part 9 Debt Agreement was her best option. We assessed her income and expenses and found that she could clear her debts in 5 years by repaying just $550 a month. Skylar’s creditors agreed to the arrangement with a creditor return of 66%.
The Part 9 Debt Agreement allows Skylar to repay her debts at an affordable amount so she can continue to support her husband through his recovery without the added stress of debt.
|Creditor||Debt Balance||Debt Repayments|
|Adelaide Bank - Home Loan||$347,550||$1,800 / month|
|Westpac - Credit Card||$19,547||$488 / month|
|CUA - Credit Card||$15,744||$393 / month|
|Total Unsecured Debt||$35,291||$881 / month|
|New Debt Repayments||$31,900||$550/ month|