Part IX debt agreement

A Part IX debt agreement is a formal, legally binding agreement between a debtor and their creditors to settle debts on agreed terms, offering an alternative to bankruptcy for an individual who cannot meet their debts as they fall due but wants to avoid the fuller consequences of formal bankruptcy.⚠ It is recorded on the debtor's credit file and on the National Personal Insolvency Index for a defined period, and while less severe in some respects than bankruptcy, it is still treated by most mainstream lenders as a significant credit event that restricts standard lending access during and for some time after the agreement. Specialist funds and private lenders active in impaired credit lending will consider borrowers who have completed, or are completing, a Part IX agreement, generally focusing on what caused the underlying financial difficulty and the borrower's conduct since, alongside the strength of the security and exit on the proposed facility. Anyone considering or subject to a Part IX agreement should seek advice from a financial counsellor or insolvency practitioner, since the decision carries consequences well beyond access to future finance.

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Impaired credit commercial loans · Discharged bankrupt · Safe harbour