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Bankruptcy is a legal process where you are declared to be unable to pay your debts.

There are two ways of becoming bankrupt:

  • you can volunteer to become bankrupt
  • a person or business that you owe money to can apply for you to be made bankrupt.

Bankruptcy gives many people a fresh start but it can have long-term consequences. It is important that you speak to a financial counsellor or a lawyer before making a decision about bankruptcy. You may have other options to deal with your debt problems instead of going bankrupt.

How we can help

We don't give legal advice about bankruptcy, but we may be able to give you some information over the phone. 

If we can’t help, we can refer you to other organisations that can.

Our resources

To see a list of all our free resources go to our catalogue.

Other legal help

Consumer Action Law Centre

The Consumer Action Law Centre gives free legal advice and representation to vulnerable and disadvantaged consumers across Victoria. You can ask a legal expert for advice about whether you have grounds to dispute a debt. The Consumer Action Law Centre has fact sheets about dealing with debt and debt collectors.

The MoneyHelp website is managed by the Consumer Action Law Centre. It offers free, confidential and independent financial information to Victorians experiencing difficulty paying their rent or mortgage or facing job loss. Call or email the free financial counselling service.

Your local community legal centre can give you legal information and advice. Most services are free.

Financial counsellors and financial information

Financial counsellors help people who are in financial difficulty. There are free financial counsellors in most suburbs and regional areas. They provide advice about your financial situation, your options, and the consequences of those options.

A financial counsellor can also check your documents, help you sort out your debts and negotiate with creditors and lenders on your behalf.

It can sometimes take a while to get an appointment with a counsellor, so it’s important to contact them as soon as possible – don’t leave it till the last minute.

Money Smart has a free financial counselling hotline or you can search for a financial counsellor near you.

Other organisations and services

Australian Financial Security Authority

The Australian Financial Security Authority administers personal insolvency laws. It can supply you with all the necessary bankruptcy papers and refer you to a financial counsellor or other appropriate body for assistance. You can call the Australian Financial Security Authority from anywhere in Australia on 1300 364 785.

Financial Ombudsman Service

The national Financial Ombudsman Service deals with complaints about financial services including banking, credit, loans, general insurance, life insurance, financial planning, investments, stockbroking, managed funds and pooled superannuation trusts.

The service provides free, accessible dispute resolution for consumers and some small businesses who are unable to resolve a dispute directly with their financial services provider. External dispute resolution processes can help to resolve disputes through negotiation or conciliation as an alternative to court proceedings and can make decisions that are binding on participating financial services providers.

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