What is the No Asset Procedure

No Asset Procedure (NAP) is something that you should be very worried about, why, because it allows a debtor with total debts under $40,000 and no realisable assets and no means of repaying, to apply to the Official Assignee to be granted NAP and in effect have all their debts written off and you have no right to pursue them for any unsecured money owed to you.

There are a few other criteria like this won’t write off student loans indicating that the Government is keen to protect their money but not yours.

So how do you protect yourself from something like this?

Well the best way is not to give credit. Far too much credit is given to people who don’t deserve it or in situations where it is not necessary.

But if you are going to give credit make sure you know the credit worthiness of the person to whom you are giving credit by obtaining all the necessary information about the debtor and doing proper credit checks.

Make sure you are a secure creditor by registering the debt on the Personal Property Security Register (PPSR).

To find out more about the pitfalls of giving credit and how to avoid bad debt  contact Just Collections today.

Comments on this entry are closed.