A Part 9 debt agreement is a formal, legally binding arrangement to repay part of what you owe, as an alternative to bankruptcy. You propose an amount you can actually afford, your creditors vote on it, and if enough of them accept, every creditor covered by it is bound — including the ones who voted no.

It is not bankruptcy. AFSA describes a debt agreement as “a flexible way to come to an arrangement to settle debts without becoming bankrupt.” But it is a formal insolvency arrangement under the Bankruptcy Act, it goes on a public register, and it stays on your credit file for years. This page covers how it works and what it costs you beyond money.

What is a Part 9 debt agreement?

“Part 9” — sometimes written Part IX — refers to the part of the Bankruptcy Act 1966 the arrangement sits under. That’s all the name means. A debt agreement and a Part 9 debt agreement are the same thing.

It works on your unsecured debts: credit cards, personal loans, buy-now-pay-later, overdue utilities, some tax debt. Secured debts are different, because the lender holds an asset behind them. A car loan doesn’t stop being a car loan because you enter a debt agreement, and the car can still go back.

The core idea is that you make one regular payment, set on what you can actually manage, instead of juggling several you can’t meet. What creditors weigh up in return is certainty, against what they might otherwise recover.

How does a Part 9 debt agreement actually work?

A registered debt agreement administrator looks at your income, your living costs and what you owe, then builds a proposal on what’s genuinely left over. That proposal goes to your creditors, and they vote on it.

The vote is decided by value, not by headcount. As Moneysmart puts it, “if creditors representing the majority of debts accept the proposal, the debt agreement proposal becomes a debt agreement.” If they reject it, “there is no debt agreement” — you’re back where you started, and you look at other options.

Nobody can promise you a particular vote. Any administrator who tells you creditors will accept is telling you something they cannot know. What a proposal can be is realistic, well-documented and built on numbers that hold up — which is the part that’s actually within anyone’s control.

Once it’s accepted, you make one regular payment to the administrator, who distributes it to your creditors.

Am I eligible for a Part 9 debt agreement?

AFSA sets four tests, and you have to meet all of them. You must be “unable to pay your debts when they are due”; you must “have not been bankrupt, had a debt agreement or personal insolvency agreement in the last 10 years”; you must “have unsecured debts and assets less than the set amount”; and you must “estimate your after-tax income for the next 12 months to be less than the set amount.”

Those last two are the ones people get wrong, because the set amounts move. AFSA indexes them and updates them every 20 March and 20 September — the most recent change was days ago. Any dollar figure you read in an article, including the ones this page deliberately doesn’t print, can be out of date by the time you read it. Check AFSA’s current amounts, or ask someone to check them with you.

The ten-year rule catches people too. It looks back at bankruptcies and debt agreements, not at informal arrangements or consolidation loans.

How long does a Part 9 debt agreement last?

Terms are commonly set at three to five years. That is the length of the arrangement, and it is a fact about the product rather than a prediction about you — what your own term would be depends on what you owe and what you can afford, and it is settled before anything is proposed.

Longer isn’t automatically worse. A longer term means smaller regular payments, which is sometimes the difference between an arrangement that holds and one that falls over in year two.

What does a Part 9 do to your credit file?

This is the part worth reading twice, because it is the cost that outlasts the payments.

A debt agreement is “listed on your credit report for five years or more”, and your name and the details of the agreement go on the National Personal Insolvency Index “for five years or more” as well. The NPII is a public register — anyone can search it, and it is not the same thing as your credit file quietly ageing out.

While you’re in the agreement you should expect borrowing to be effectively closed to you, and Moneysmart notes you must tell new credit providers about the agreement if you’re seeking more than a set amount of credit. Plan on the basis that a new loan or card is not available during the term, because in practice it usually isn’t.

Can you travel, rent or keep your job on a Part 9?

These are the three fears people actually ring about, and they’re mostly fears about bankruptcy that have attached themselves to debt agreements.

A debt agreement does not carry bankruptcy’s overseas travel restriction. Renting is a practical question rather than a legal one — a property manager who runs a credit check will see the listing, and how much that matters varies by agent and market. Employment is the same: most jobs are unaffected, but some licensed and regulated occupations ask about personal insolvency, and if yours is one of them that’s a question to settle before you propose anything, not after.

Part 9 debt agreement vs bankruptcy — what’s the difference?

Bankruptcy is heavier in almost every direction. AFSA’s own guidance on bankruptcy notes that many personal insolvency records “will remain on the NPII permanently”, and that a bankruptcy sits on your credit report for “5 years from the date you became bankrupt or 2 years from when your bankruptcy ends, whichever is later.”

Bankruptcy also brings a trustee with power over divisible property, income contributions above a set threshold, and restrictions on overseas travel. A debt agreement has none of those.

That doesn’t make a debt agreement the right answer. It makes it a different answer, with its own eligibility limits and its own consequences, and for some people bankruptcy genuinely is the cleaner path. Anyone who tells you one is always better than the other is selling, not advising.

What if I don’t qualify — is there a Part 10?

A Part 10 personal insolvency agreement is the other formal alternative to bankruptcy. It has no debt, asset or income thresholds, which is why it comes up when someone is over the Part 9 limits, and it involves a controlling trustee rather than a debt agreement administrator.

It is a more involved and more expensive process, and it is a different conversation. Informal arrangements directly with creditors are also still on the table, and they don’t go on any public register at all.

What happens after a Part 9 debt agreement ends?

When you complete the payments, the covered debts are settled and the agreement is recorded as complete. What doesn’t end on the same day is the listing — the credit report entry and the NPII record run on their own clock, which is why “finished” and “invisible to lenders” are two different dates.

The practical rebuild starts immediately, though: a clean run of on-time payments after the agreement is what a future lender actually reads.

Should I speak to a free financial counsellor first?

If you want free, independent help before you speak to anyone who charges, yes. The National Debt Helpline is on 1800 007 007, and describes financial counselling as “a not-for-profit service” that is “always free and confidential,” delivered by counsellors who “don’t lend money or sell you anything and work only in your interest.”

We point people there before we talk about ourselves, because it’s the right order.

How do I choose a debt agreement administrator?

Only a registered administrator can lodge a debt agreement proposal. Moneysmart’s advice is to check your administrator is on AFSA’s list of registered debt agreement administrators, and to know what they charge before you commit.

Both are easy to check and worth checking. Debt Negotiators is an AFSA-registered Debt Agreement Administrator, registration 1403. We administer debt agreements ourselves rather than referring you on, we hold Australian Credit Licence 390820, and we’re a member of the Australian Financial Complaints Authority (25029). Costs are explained to you before you agree to anything.

We are not a trustee, not a registered liquidator and not a law firm. Where one of those is what you need, we say so.

What happens if I call?

We look at what you owe, what you earn and what’s actually left, and tell you which options that leaves open — including the ones that aren’t us. There’s no cost for the assessment and no obligation to go further.

Every conversation with our team is confidential and judgement-free, whatever your situation. Since 2009 we’ve helped over 15,000 Australians work towards managing their debt, and our team of 25 supports clients right across the country from our base in Bankstown, NSW.

Wondering whether a Part 9 fits your situation? Call 1300 351 008 or request a free debt assessment. We’ll call you back the same business day. You can also read more about how debt agreements work.

Written by the Debt Negotiators team — an AFSA-registered Debt Agreement Administrator (registration 1403) holding Australian Credit Licence 390820 and AFCA membership 25029, helping Australians with unmanageable debt since 2009. About our team.

This article is general information about Part 9 debt agreements in Australia, not a recommendation about your circumstances. Eligibility rules, listing periods and quoted passages were checked against AFSA and Moneysmart on 21 September 2026. AFSA’s threshold amounts are indexed and change on 20 March and 20 September each year — check the current figures before relying on them.