Discharged bankruptcy
What is discharged bankruptcy?
The term “discharge” is purely an automatic process of the law which releases the bankrupt from the bankruptcy, however the bankrupt estate continues and the now ex-bankrupt still has an obligation to cooperate with the trustee.
Save yourself the hassle of approaching the major banks only to find that they cannot approve your application due to your credit history of being bankrupt. Please enquire online to find out your options on getting a loan approval after being discharged from bankruptcy.
Is there an alternative to a discharge from bankruptcy?
Yes, the bankruptcy may be annulled. An annulment is a complete undoing of bankruptcy, as if the bankruptcy never happened. However in saying so, this does not mean that the lenders will not know that you were previously bankrupt. Your credit history will still show the period of your bankruptcy and when this was discharged.
In simple terms, a discharge is the conclusion to the legal status of bankruptcy against the person who is in debt. On the other hand, an annulment cancels the bankruptcy entirely, removing the bankrupt from bankruptcy and ending the bankrupt estate completely.
How long does it take to clear bankruptcy?
Bankruptcy information is held on your credit file for 7 years, however if the Statement of Affairs is never filed then the bankruptcy will continue until the bankruptcy dies - this can sometimes reach over the 7 year term.
It is best to confirm that you have been discharged by bankruptcy prior to enquiring for a home loan. You can seek legal advice to do so or you can simply request for a copy of your credit report from Veda Advantage and it will state the date you were discharged and cleared from bankruptcy.
Are all my debts cleared after being discharged?
Debts that you have are recorded on your credit file and can be cleared once you have been discharged from bankruptcy. However there are some debts which remain on your credit file despite being discharged from bankruptcy, these debts include:
- Court fines
- HECS debts
- Child support payments
- Debts incurred by fraud
- Student loans
Please enquire online if you wish to speak to a specialist mortgage broker who can determine whether you are eligible for a home loan in your situation.
